Have you ever been in a situation where it is hard to get a bank account? And, thinking about how can I deposit a check to a prepaid card? Or have no access to one? And still needed money for food, gas, or other basic needs. I am here to tell you how and why prepaid cards are an alternative option that might be better for you than cash.
What Is a Prepaid Card And How Do They Work?
If you already know what is a prepaid card and how it works, just skip that and scroll down to the process about how you can deposit a check to a prepaid card.
A prepaid card is just like any ordinary debit card but only works on the honor system. This means that it does not rely on your bank or credit to honor your purchase or transaction you made with them, but rather the prepaid card’s network (for example, Visa Prepaid).
That’s why when you use a prepaid card; it is called a “cash equivalent” because there’s no cash you can get from the prepaid card issuer if your purchase was not honored by the network.
The only way to get money out of this financial instrument is by using another person or place that does take prepaid cards as a form of payment. So unlike a bank account, you cannot take cash out and put cash into the prepaid card.
This is why many refer to it as a “scam” or “con” because people think that all the money is locked up inside the card itself, but it isn’t. Most of your money will be stored on the network and only loaded onto the actual card if you request for money to be put onto the card.
This is why they are referred to as “prepaid” cards because your balance is pre-loaded and cannot go below zero unless you don’t have enough funds for a purchase.
How can I deposit a check to a prepaid card?
Depositing a check to your prepaid card is very easy, but it has some requirements for you to meet for the deposit to be successful.
1. Direct Deposit
The first requirement that you have to meet is that you need a bank account. Without one, you cannot receive your paycheck from your employer electronically. Some companies offer to give their employees the choice of direct deposit or a prepaid card as an option to receive their paycheck from them instead.
Another way people try to deposit checks on prepaid cards without a bank account is by going through a bank or money transfer company. If you do not have a bank account, you should try looking up a local branch and see what they can offer you to open an account with them.
2. Using a Mobile App
If you do not have a bank account and cannot get one, the best way to receive your money is through mobile apps. There are many different ones out there that can help you do so even with no bank account.
The three biggest companies right now are GoBank®, Green Dot®, and Account Now®. If you go onto their websites, you can get reloadable prepaid cards with no fees that you will use at the ATM until you have enough funds on your account.
3. Ingo Money App
When you sign up for Ingo Money, they will send you a check and tell you what to do with it. They offer free deposits to your prepaid card, but if you want an instant deposit, there is a fee of $4.95 (including access to the funds and no monthly fees), and foreign deposits are an extra $2.00. You will receive your funds typically within one business day after the deposit is made into their system.
4. Use a Reload Location
Using a reload location is one of the most effective ways to deposit money onto your prepaid card. When you purchase something with someone, you will receive a receipt in return which includes where to take your cash for reimbursement. Many people do not realize that they can use this receipt to place more money on their prepaid cards when they are out shopping.
5. In-Person and ATM Deposits
You can also make in-person and ATM deposits, but there is a catch with this method. The money that you deposit into your prepaid card will be added to the total balance of your account immediately after the deposit is made.
However, it will not be available for use by you unless you activate them first. This might seem like a great idea, but you will be charged a fee for this deposit to your prepaid card.
6. Bank-to-Bank Transfer
Lastly, you can also do a bank-to-bank transfer. This is the best way to deposit cash on your prepaid card because no fees apply to this deposit method.
You will need to visit your financial institution’s website and find out if they offer an option for transferring funds onto prepaid cards. It might take up to three business days before your deposit will be on the card, but this is probably the best way to do so if you need instant access.
What is the average prepaid card fee?
The average prepaid card fee is typical $5. However, there are companies out there that charge up to $9 for this service. This part of the prepaid card fee is what you will be responsible for paying every month.
The average checking account fee ranges anywhere from $5-12. This means that the only reason someone would choose to use a prepaid card over a bank account is to save money.
What else does it cost me to own a prepaid card?
When you own a prepaid card, you will need to consider the following:
Monthly Fees: The average monthly fee for a prepaid card is $5. However, some companies charge as much as $9. This means that if you do not use your card often and only have it for emergencies, this might not be the best option for you.
Cash Reloading Fees: This is the other part of the prepaid card fee that people will need to know if they plan to use as their primary way to access their money. The average cash reloading fee is $4.00, but some companies charge $8.25 for this service.
ATM Fees: When using a prepaid card, you might be charged up to $2 every time you withdraw money from an ATM. This can add up quickly if you need to use the same machine multiple times per month.
For example, if someone used their prepaid card at least five times per month and had to pay the $2 ATM fee every time, this would add up to a total of $120 per year.
Inactivity Fees: If you do not use your prepaid card for three months or more, there is a chance that you will be charged an inactivity fee. This can range anywhere from $1-3 and might not seem like a lot of money, but it will add up quickly if you are not using the card.
Bill Payment Fees: If you need to use your prepaid card to pay for things such as utilities or other bills, there is a good chance that you might be charged a fee.
Just keep in mind that some companies do not charge a bill payment fee, but it is a good idea to check with the specific companies that you want to pay before you use your prepaid card.
Insufficient Funds Fees: This part of the fee will occur if you make an ATM deposit, but there is not enough money in your account to cover the transaction. In this case, there might be a fee for the deposit, but it will be refunded to you.
However, there is also a chance that you might have to pay an insufficient funds fee.
Customer Service Fees: If you need customer service, then there is a good chance that this fee will apply to your account. The average customer service fee is about $3. For example, if you needed to contact customer service and charged $3, this would be deducted from your balance.
If you are trying to find the best option to deposit a check to a prepaid card, this article is for you. Here you will find that can I deposit a check to a prepaid card. The fees you pay to use the prepaid card will vary depending on what company you choose to go with, but most people find it considerably cheaper than using a checking account.
If you do not want to pay monthly fees or other charges associated with using a checking account, you might want to consider purchasing a prepaid card. This way, you will be able to access your money without worrying about fees or bank accounts.