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Prepaid debit cards have come a long way. Re-loadable cards were once an expensive and inconvenient way to handle your money. Today, the fees have come way down while more features have been added. One key feature is high yield savings accounts.
There is a battle being waged in the electronic payment industry. The battle is being fought between traditional credit cards, bank debit/ATM cards, prepaid debit cards, and other mobile payment systems. In short, these methods of payment are fighting for your business. While you probably don’t spend your days studying the electronic payments industry, evidence of this battle is everywhere. Here are just a few examples of how the card industry is fighting for your business:
- Sign-up Bonuses: More and more credit cards are offering statement credits or cash bonuses to new cardholders.
- Lower Fees: While credit card fees have been on the rise, the fees charged by prepaid debit cards have fallen significantly. Several prepaid cards now waive an activation fee and charge virtually no monthly fees for purchase transactions.
- Checking Account Bonuses: Everywhere you look banks are offering either cash bonuses or interest rate bonuses to get your business.
- 0% Introductory Rates: While zero percent intro rates are nothing new, credit cards have become more aggressive in their promotions over the past several months. You can now find no-fee balance transfers or 0% rates good for 21 months (see our list here).
Now prepaid debit cards are entering the fray. By offering high interest savings accounts, they give customers a chance to earn a few extra bucks and encourage saving at the same time.
So let’s take a look at five prepaid cards that offer savings accounts with great rates.
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Prepaid Debit Cards with Savings Accounts
Netspend Prepaid Visa Card
With the Netspend Prepaid Visa Card, you get access to a savings account that pays up to 5% APY. This rate applies to balances up to $1,000. Balances over that amount earn 0.50% APY.
The card comes with a wealth of other features. These include text alerts, direct deposit, a Smartphone app, and even cashback rewards.
You can also load cash on the card at over 130,000 locations. With the smartphone app, you can deposit paper checks onto the Netspend card. And you can easily transfer funds to friends and family who also have the Netspend card.
Brink's Money Prepaid Mastercard®
The last option on our list comes from a company known for armored cards. The Brink's Money Prepaid Mastercard® offers 5.00% APY on the first $1,000 in savings. After that, the rate goes to 0.50% APY.
The card also offers several other features. One is called a purchase cushion. Brinks will cover a shortfall on your card up to $10. You can also earn what Brink’s calls Payback rewards. These rewards act like cash back at select stores.
A prepaid card combined with a savings account has numerous benefits. First, it encourages savings. Second, it can help you budget your money. By moving some cash to savings, you’re less likely to spend it. And finally, these savings accounts pay much higher interest rates than what’s available from a traditional bank.