Consumers Guide to Prepaid Cards Lori Scharmer, M.S., A.F.C., Interim Family Economics Specialist 2013 1.

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Presentation transcript:

Consumers Guide to Prepaid Cards Lori Scharmer, M.S., A.F.C., Interim Family Economics Specialist

What is a prepaid card? Gift card Return credit card Rebate card Reloadable card 2

When may a prepaid card be useful? 3

Advantages of a Prepaid Card Safer than cash Convenient No credit check No overspending No bank account needed Direct deposit 4

Disadvantages of a Prepaid Card Loaded with fees Does not build credit history Limited regulations Limited protections 5

$ Prepaid cards will have FEES! Companies offering reloadable prepaid cards are in business to make a profit. That profit comes from the fees they charge the card users. Consumers should shop for cards with the lowest fees. Consumers should shop for cards with the lowest fees. 6

Shopping for a Prepaid Card Tips on choosing the best card: Will card be accepted everywhere? Minimum balance or reload limits? Daily cash withdrawal limit? Convenient ATMs for withdrawals? Fees charged? Protections offered? 7

$ Consumer Protection for Prepaid Cards Prepaid cards are a fairly new financial tool. Government regulations and protections for consumers still are being developed. Treat your prepaid card like cash; protect yourself from fraud or theft. 8

Managing a Prepaid Card ● Prevent unnecessary fees ● Use an app for monitoring ● Use online monitoring system ● Use online monitoring system Like any money account, reloadable cards need to be monitored. 9

$ Reloadable prepaid cards are just one more financial tool available to consumers. 10 You decide if and when a prepaid card will work for you and your money.

Thank you for coming. Please fill out our survey. More money information from The NDSU Extension Service at Lori Scharmer, M.S., A.F.C. Interim Extension Family Economic Specialist 11