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2016 Prepaid Cards Report: Which Card Is Right For You?

ch prepaidConsumers are increasingly turning away from traditional checking accounts in favor of alternative cash-management tools – perhaps most notably, prepaid cards. Both the number of prepaid cards in circulation and the amount of money loaded to them by consumers have skyrocketed in recent years, as new issuers have entered the market and the general public has grown acquainted with this relatively new financial instrument. As of 2012, roughly 12 million Americans used a prepaid card at least once a month and we collectively loaded $65 billion to our accounts – double the amount loaded just three years prior. Those figures rose to 23 million users loading $76.7 billion in 2014, according to Mercator Advisory Group, which projects $343 billion loaded to prepaid cards in 2018.

Prepaid cards can be a great tool for many different types of people, as they’re safer than cash and eliminate the threat of overdraft fees and bounced checks. They also offer guaranteed approval and provide the same functionality as a checking account-debit card combo, just without the physical checkbook. As such, there are four groups in particular that we feel should seriously entertain the idea of getting a prepaid card:

  1. Those Looking For A Replacement Checking Account
  2. Children Managing Their Allowance
  3. People Looking For An Affordable Alternative To Check Cashing Stores
  4. Consumers Seeking Access To Electronic Transactions

With that being said, the cost of a prepaid card can vary widely depending on the offer you choose and the way in which you use it, as the average offer includes 10 different fees. In the interest of helping each of the aforementioned groups find the best cards for their needs, CardHub used its proprietary cost comparison tool to evaluate 40 of the most popular prepaid cards based on four hypothetical scenarios designed to reflect common usage habits. You can find the results below.

Key Findings

 

Choose Wisely Or Pay The Price: Each type of prepaid card user has at least one free option available, and finding it is crucial considering the wrong card can cost consumers up to $311 per year.

 

Big-Bank Savings: Prepaid cards from large banks are up to 82% less expensive than their small-bank counterparts.

 

Features Falling Short: Up to 48% of prepaid cards may not be suitable for common consumer needs, due to a lack of necessary features.

 

Few Celebrity Endorsers Survived: Prepaid cards founded or endorsed by celebrities – common in the market’s early days – have largely disappeared, reflecting the market’s maturation.

Survivors Graveyard
RushCard (Russel Simmons) Kardashian Kard (Kim Kardashian)
GreenDot Cards (Steve Harvey) SpendSmart Teen Prepaid Card (Justin Bieber)
- The Approved Card from Suze Orman (Suze Orman)
- Young Money Prepaid Card (Lil Wayne )

 

Mostly Falling Costs: “Alternative Check-Cashing Tool” is the only use case for which costs rose significantly relative to 2015 (34.84%). The cost of other use cases fell by an average of 8.21%.

Note: Although we have been conducting this report since 2011, a change to our methodology in 2015 prevents accurate price comparison for previous years.

 

Fees Galore: Perhaps surprisingly, prepaid cards charge far fewer fees than their first cousin, checking accounts.

2016’s Best Prepaid Cards

The offers below represent the lowest-cost options with all of the necessary features for each use case considered in this report. Our editors also performed a more-qualitative analysis of these cards to further narrow down the field and ultimately determine their picks for 2016’s Best Overall Prepaid Cards.

Scenario Cards Estimated Annual Cost /Number of Fees
Alternative Checking Account American Express Serve Serve $0/3
Bluebird Prepaid CardBluebird $0/1
Green Dot Gold CardGold $0/7
KAIKU Card
Kaiku
$0/2
Walmart Money CardWalmart $5/7
Child’s Allowance Account Bluebird Prepaid CardBluebird $0/1
Emerald Prepaid Card
Emerald
$0/9
Alternative Check Cashing Tool Bluebird Prepaid CardBluebird $0/1
Emerald Prepaid Card
Emerald
$0/9
Access to Electronic Transactions Bluebird Prepaid CardBluebird $0/1
Fewest Fees Bluebird Prepaid CardBluebird 1
KAIKU Card
Kaiku
2

Previous Years’ Best Cards:

Alternative Checking Account Child’s Allowance Account Alternative Check Cashing Tool Access to Electronic Transactions Fewest Fees
2015 – American Express Serve
– Bluebird Prepaid Card
– Green Dot Gold Prepaid Visa Card
– KAIKU Visa Prepaid Card
– Bluebird Prepaid Card
–Emerald Prepaid Card
– American Express Serve
– Bluebird Prepaid Card
– Emerald Prepaid Card
– American Express Serve
– Bluebird Prepaid Card
– Bluebird Prepaid Card
– Target Prepaid Card
2014 – Green Dot Prepaid Card
– Walmart MoneyCard
KAIKU Visa Walmart MoneyCard American Express Serve
–American Express/ Bluebird
– Walmart MoneyCard
American Express/ Wal-Mart Bluebird
2013 – Green Dot
– Bluebird
– AMEX Serve
– Kaiku Visa – Chase Liquid
– PNC Smart Access
– Chase Liquid
– Bluebird
– AMEX Serve
– AMEX
2012 – Green Dot – The Approved Card – Chase Liquid N/A N/A
2011 – Green Dot – Green Dot N/A N/A N/A

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Detailed Findings

Alternative Checking Account Child’s Allowance Account Alternative Check Cashing Tool Access to Electronic Transactions Total Number of Fees
AccountNow Gold Visa Prepaid Card $131 $131 $131 $214 12
AccountNow Prepaid MasterCard $252 $108 $156 $191 14
AccountNow Prepaid Visa Card $252 $108 $156 $191 14
ACE Elite FeeAdvantage Prepaid Card $252 Not Suitable $311 N/A* 14
ACE Elite Visa Prepaid Debit Card (Pay-As-You-Go) N/A* Not Suitable N/A* $96 15
AchieveCard Visa Prepaid Card Not Suitable Not Suitable Not Suitable $119 9
American Express Serve $0 $12 $12 $12 3
American Express Serve Cash Back $71.4 $71.4 $71.4 $71 3
BB&T MoneyAccount Prepaid Card $72 $96 $72 $60 9
Bluebird Prepaid Card $0 $0 $0 $0 1
Chase Liquid Prepaid Card Not Suitable Not Suitable $59 $59 8
Emerald Prepaid Card $23 $0 $0 $23 9
Fifth Third Access 360° Reloadable Prepaid Card Not Suitable Not Suitable Not Suitable Not Suitable 6
Green Dot Gold Prepaid Visa Card*** $0 Not Suitable $238 $214 7
Green Dot Prepaid Card $120 Not Suitable $165.6 $214.2 7
KAIKU Visa Prepaid Card $0 $36 $36 $107 2
Mango Prepaid Card Not Suitable Not Suitable Not Suitable $155 4
MyVanilla Prepaid Visa Card Not Suitable Not Suitable Not Suitable Not Suitable 14
NetSpend Prepaid Card – FeeAdvantage $252 Not Suitable $311 N/A* 15
NetSpend Prepaid Card – Pay-As-You-Go N/A* Not Suitable N/A* $96 16
PayPal Prepaid Card Not Suitable $178 Not Suitable $59 9
PayPower Visa Prepaid Card Not Suitable Not Suitable Not Suitable $71.4 14
READYdebit Control Prepaid Card $252 $108 Not Suitable $215 14
READYdebit Visa Gold Prepaid Card $71 $71 $71 $178 11
READYdebit Visa Select Prepaid Card $131 $131 Not Suitable $238 11
Regions Now Card Not Suitable Not Suitable** $240 Not Suitable 9
RushCard $83 $107 $107 $95 13
RushCard with Pay As You Go Plan N/A* N/A* N/A* N/A* 14
SilverCard Prepaid MasterCard $106 $83 Not Suitable $93 17
SmartAccess Prepaid Visa Card Not Suitable $84 Not Suitable Not Suitable 10
Univision MasterCard Prepaid Card Not Suitable Not Suitable Not Suitable $238 5
UPside Prepaid Debit Card Not Suitable Not Suitable Not Suitable $131 10
Ventra Prepaid Card Not Suitable $12 Not Suitable Not Suitable 9
Vision Preferred Prepaid Visa Card $240 $96 Not Suitable $119 6
Vision Premier Prepaid Visa Card $53 $119 Not Suitable $214 7
Walmart Money Card**** $5 Not Suitable $149 $132 7
Wells Fargo Prepaid Card Not Suitable Not Suitable $60 Not Suitable 7
Western Union Netspend Prepaid MasterCard – (Pay-As-You-Go) N/A* Not Suitable N/A* $96 16
Western Union Netspend Prepaid MasterCard – FeeAdvantage $252 Not Suitable $311 N/A* 15
Wired Plastic Prepaid Card $107 $190 Not Suitable $95 14
*”N/A” is meant to indicate that the cost under this scenario is not applicable given that cardholders can call customer service and immediately change their payment plan for free in order to minimize expenses. For example, the Netspend Fee Advantage Plan is listed as “N/A” on Scenario 2 because cardholders can easily switch to the Pay-As-You-Go Plan, which is cheaper.
** Regions Now card allows deposit transfers from your existing Regions checking or savings account.
*** This product is in the process of being replaced by the new Green Dot Reloadable Prepaid Card
**** Walmart-specific rewards may help cardholders who regularly make purchases at the retailer subsidize account costs.

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Methodology

CardHub analyzed 40 of the most popular prepaid cards on the market to determine if they offer the features needed by major consumer groups and, if so, how much each would cost to use. This evaluation was based on CardHub’s proprietary cost comparison tool and the application of account data to four distinct scenarios (see below) designed by CardHub to reflect common usage habits. The data was then sent to each of the 19 issuers included in the report for verification. Green Dot (partially; for Walmart Money and Green Dot Prepaid cards but not for AccountNow, READYDebit and Acheive prepaid cards), American Express, PayPal, Regions, Rush Card, Fifth Third, Chase, Wells Fargo, PNC and Kaiku cooperated in the process. InComm (MyVanilla cards) and BH Network (PayPower card) declined to confirm the data. NetSpend, H&R Block (Emerald card), BB&T, Mango Financial (Mango card), Upside card, Ventra, Wired Plastic and Univision cards failed to respond in a timely manner.

If a given card was deemed to lack a key feature needed by one of the major consumer groups, it was disregarded for that usage segment and labeled, “Not Suitable.” In cases of a single card offering multiple usage plans, we compared the most affordable plan for each scenario given that cardholders can immediately change their payment plan with a phone call to customer service.
Finally, we relayed the preliminary results of our research to each of the issuers so they could verify the data. Each did so prior to publication.

The usage scenarios considered in this report are described below.

Scenario 1: Alternative Checking Account

This individual:

  • Earns a monthly paycheck of $2,000,
  • Can use direct deposit,
  • Withdraws cash from the ATM once per week
  • Makes five prepaid card purchases per week
  • Pays two monthly bills by check using online bill pay (the billers do not accept card payments).

Total Annual Cost = (1X monthly fee +1X paper statement +1X direct deposit card load fee+ 4X ATM withdrawal fee + 20X purchase transaction fee + 2X online bill pay by check fee) X 12

Required Account Features:

  • Direct Deposit
  • Paper Statement
  • Online Bill Pay Via Check

 

Scenario 2: Child’s Allowance

This family gives their teenager a monthly allowance of $100, using their bank account or PayPal. The teenager then:

  • Withdraws cash from the ATM twice per month
  • Makes two prepaid card purchases per week.

Total Annual Cost = (1X monthly fee +1X paper statement + 1X bank transfer card load fee + 2X ATM withdrawal fee+ 8X purchase transaction fee) X 12

Required Account Features:

  • Account cannot be restricted to users who are 18+
  • Funds can be loaded via bank account or PayPal (since most parents don’t want to go to the store every time they give their kids an allowance)
  • Paper Statement

 

Scenario 3: Alternative Check Cashing Tool
This individual:

  • Earns a two monthly paychecks of $800 each
  • Cannot use direct deposit
  • Must load checks directly to prepaid card
  • Withdraws cash from ATMs once per week

Total Annual Cost = (1X monthly fee + 1X paper statement + 4X check reload fee+ 4X ATM withdrawal + 12X purchases) X 12

Required Account Features:

  • Ability to load checks directly to prepaid account
  • Paper Statement

 

Scenario 4: Access to Electronic Transactions

This person:

  • Earns $2,000 per month, paid in cash weekly
  • Uses online bill pay two times per month
  • Loads $250 to their prepaid card account twice per month
  • Makes two prepaid card purchases per week

Total Annual Cost = (1X monthly fee + 2X cash reloads + 0X ATM withdrawals+ 2X electronic online bill pay + 8X purchases) X 12

Required Account Features:

  • Ability to deposit cash into prepaid account
  • Online Bill Pay

 

Assumptions:
CardHub used the following assumptions in determining the total cost of each prepaid card usage scenario.

    • ATM Fees: If a prepaid card is associated with a free nationwide network of at least 2,000 ATMs, we assumed the cardholder would be able to avoid ATM fees. This assumption applied to all usage scenarios.
    • Number of Transactions: The number of debit purchases cardholders are expected to make under each scenario were based on usage information from The 2009 Survey of Consumer Payment Choice from the Federal Reserve Bank of Boston. According to this survey, the average debit card user makes roughly 20 purchases each month, and given that Scenario 1 involves an alternative checking account, that was the number used. For Scenario 2, we assumed two purchases per week (8 per month) due to the fact that the child using the card only receives a $100 monthly allowance and will make purchases mostly on weekends. Scenario 3 assumes three purchases per week (12 per month) because consumers in this group are more accustomed to using cash and therefore will not make as many purchases with plastic as cardholders in Scenario 1.

      The consumer in Scenario 4 gets paid in cash and therefore has no need to withdraw money from ATMs and less reason to use the card for purchases since they can use cash for most purchase transactions. We therefore assumed two purchases per week for this scenario. In addition, some cards charge different fees for signature and PIN transactions, and in those cases we assumed cardholders would make signature transactions because their fees are smaller.

    • Fee Ranges: Where fees were presented as a range between two amounts, we have chosen the lowest amount of the ranged for our cost assessment.
    • One-Time Bonuses: Certain cards offer one-time sign-up bonuses tied to different account services. We did not take these bonuses into account. We did, however, incorporate regular bonuses into the total cost assessment.
    • Interest Rates: We gave credit to cards offering interest earnings by offsetting the total cost of applicable offers in qualifying scenarios. Only the consumers in Scenarios 1 and 3 earn enough to qualify for interest.
    • Rewards: We did not take into account rewards programs that limit earning capabilities only to purchases made at specific retailers, as opposed to any purchase made with the card.
    • Online Bill Pay: We did not consider the ability to input a prepaid card’s account information directly into a payment form on a monthly biller’s website to be online bill pay. Yet consumers should be aware that this is a viable alternative in certain situations.
    • Number of Fees: To determine the total number of fees charged by an issuer, we reviewed fee schedules and customer agreements online and then asked each issuer to confirm the data.

Cash reload fees are often assessed by third-party retail establishments and not by card issuers. As such, we did not include such costs in our calculations of the total number of fees charged by each card.

Editorial Disclaimer: Editorial content is not provided or commissioned by financial institutions. Opinions expressed here are the author’s alone and have not been approved or otherwise endorsed by any financial institution, including those that are CardHub advertising partners. Our content is intended for general educational purposes and should not be relied upon as the sole basis for managing your finances. Furthermore, the materials on this website do not constitute legal advice and should not be relied upon as such. Please let us know if you have any questions or suggestions.

Ad Disclosure: Offers originating from paying advertisers are noted as “Sponsored” on the offer's details page. Advertising may impact how and where offers appear on this site (including, for example, the order in which they appear). At CardHub we try to list as many offers as possible but we don't make any representation of listing all available offers.

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DISCUSSION
Jan 8, 2016
Photo of April F.
Jan 8, 2016
Letter to the editor

I seen your endorsement of green dot card. I have had a few pre paid cards from green dot issued for Walmart. I recently found out that my employer deposited funds to a card o no longer had and when I talked to the rep at Walmart the saw the entry and said they would initiate a refund since the account was closed and inactive. They said it would take 2 weeks a few days shy of two weeks I called to get an update I encounter the rudest most confrontational reps and was then informed that they needed to have me email them a copy of more
Oct 22, 2015
Photo of Teresa C.
Oct 22, 2015
How can I reach someone from Green Dot to talk to? I need to speak with a supervisor ASAP.
Oct 27, 2015
Photo of Card H.
Oct 27, 2015
You can contact the customer service at 866-795-7597. Hope this helps.
Sep 5, 2015
Photo of Adam C.
Sep 5, 2015
Greendot definitely screwed me the first of Sept. I put $150 on my card to pay my phone bill the night before and planned on paying It the following day. So the next morning I had all my rent in cash ready to pay my landlord. But first I needed to pay my phone bill because that's how I stay in contact with my customers NO PHONE NO MONEY !!! I had saved just enough for my phone bill and my rent so I call my wireless provider to pay them with my greendot gold card that I had just loaded with $150 the night before and my wireless provider more
May 30, 2015
Photo of Jim G.
May 30, 2015
actually fidelity cash management account to me is the best no overdraft when you go to a atm they put the surcharge and bank fee back into your account and your direct deposit comes in on Thursday mornings around 730 am
Mar 17, 2015
Photo of India V.
Mar 17, 2015
I had enjoyed this until I lost my cc. They want my cc number and security code before they send a new cc. Who keeps the cc number and security code. They said to log into www.walmartmoneycard.com and click "Account Management, a tab that does NOT exist. Now my money is tied up in neverland.
Sep 23, 2014
Photo of Chuck J.
Sep 23, 2014
i like this.
Sep 7, 2014
Photo of Heatherannlacie B.
Sep 7, 2014
I still cant get in to create a account yet I get text messages every day saying all is good it has had money for 3 weeks now I'm lost for words the absolute worst card I have ever encountered I have 3 others from different card companies and haven't had a bit of trouble and these Green Dot don't seem to care about its customers other wise I'd be able to reset my password but their automated system wont let me change anything except my pass code and who knows what that is now I've called I've Pleaded they assuring me all is well yet I cant spend my more
Aug 2, 2014
Photo of Jim J.
Aug 2, 2014
Noticeably absent from this 'study' were GoBank - a division of GreenDot Bank and Region's Now prepaid account.

There is a Federal rule against Banks of a certain size offering checks through prepaid accounts though from my research it appears inconsistent.

GoBank is the best Banking alternative available right now. The thing that gives it the edge over Serve or Bluebird is the English as a native language customer service.

From a purely convenience point of view as a cash card Serve is the best. The near 30,000 free cash locations is hard to beat. I would not trust it as a complete Bank alternative due to the customer service language more