Prepaid debit cards are making a dent in the check cashing business. For years check cashing shops have served that part of the monetary market that didn’t have conventional bank accounts. Pay checks, authorities checks and personal checks are all cashed for a price that can range from 1.5% to 10% of the face worth of the check. Typically individuals paid these rates simply because there aren’t any typical banks situated in their community.
Enter the prepaid debit card. Both Mastercard and Visa have prepaid debit programs that have significant advantages over the traditional check cashing shop. Probably the biggest advantage shouldn’t be having to carry around cash. In case you have just cashed your weekly or bi-weekly paycheck, what do you do with the cash? Carry it on you? Hide it someplace at dwelling?
With the prepaid debit card, your deposit is recorded and the card is the only thing it is advisable make purchases at a store, online, or get money out of an ATM. Funding your card could be executed by direct deposit or by reloading the card at one in every of thousands of stores that provide the service. There is no such thing as a want to hold around more money than you need. Because the debit card is using your own cash and isn’t a credit card, there typically is no credit check and most persons are approved online immediately. Because there isn’t any credit check there is no such thing as a inquiry recorded in your credit report.
While carrying a debit card is safer than carrying cash, there is a downside when it involves liability. Unlike a credit card which limits your liability for fraudulent use or broken or undelivered merchandise to $50, the debit card has stricter requirements. The card person must report the loss of his card or suspicion that the card has been compromised within 2 days of the occasion to limit his liability to $50. If the loss is reported after 2 days the liability jumps to $500. If the loss is just not reported for 60 days, then there isn’t any protection and your account could be wiped out. The big difference here is if you’re disputing a fraudulent credit card cost, you are not out of money. In case you report a fraudulent use of your debit card, the bank could take 10 days to research that means you are out that unauthorized use for over a week.
So how do these cards make money for the issuers? In case you are thinking about utilizing a debit card, make sure you careabsolutely read the terms and conditions and payment schedule. There are lots of programs available on the internet and so they all have different payment schedules and features. Look for a card that doesn’t cost you to reload when you use direct deposit. Look for a card that may mean you can see your balance on-line or by way of telephone without a charge. If you shop caretotally, you’ll definitely save money compared to the check cashing shops.
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