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What to Look for in Prepaid Debit Cards


Written by Melanie Pincus | Edited by Ali Cybulski | Published on 04/25/2025

When shopping for prepaid debit cards, look for products that go light on fees and run on a major card network, such as Visa or Mastercard. You can find prepaid debit cards from retailers including Walmart and Walgreens, as well as from financial technology companies and some credit unions and banks.

If you want a prepaid debit card, here's more about your choices and how to decide what's right for you.

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What is a prepaid debit card?

Prepaid debit cards are financial products that consumers can use to make purchases. You'll load a certain amount of money onto the card, and you'll be able to spend those funds. Consumers might use prepaid debit cards to manage spending and avoid carrying cash.

You won't need a credit check to get a prepaid debit card. Your activity on prepaid debit cards also won't be reported to the credit bureaus, so it won't affect your credit score.

Many prepaid debit cards are reloadable, which means you can replenish your balance and continue using the card. That said, you might be charged a fee when you reload your card. You may be able to avoid this fee if you reload with a method such as direct deposit.

Prepaid cards can also come with monthly fees, foreign transaction fees and a host of other charges. Be sure to review the terms and conditions of any card you're considering before you sign up.

Where to buy a prepaid debit card

Prepaid debit cards are available online or in person at stores. You may also be able to buy a prepaid debit card by phone or at some credit union and bank locations.

Prepaid debit cards vs. regular debit cards

Regular debit cards are connected to a bank or credit union account, and prepaid cards aren't.

That means you will need a bank account to get a debit card. Typically, you will connect a checking account to a debit card, but you may also be able to link a savings or money market account.

When you open a bank account — you'll often need to be at least 18, among other requirements — make sure your financial institution is protected by the Federal Deposit Insurance Corp. (FDIC). The standard insurance coverage limit is $250,000 per depositor, per ownership category at each participating bank. This type of insurance reimburses you up to the coverage limit if your bank fails.

Prepaid debit cards are sometimes eligible for FDIC insurance coverage. In this case, you'll want to register your card with the issuer to access protection.

With a prepaid debit card, your transaction can be declined if you try to spend more than you have loaded on the card. In some cases, this will come with a fee.

You can also have charges declined on a debit card. Or, you can overdraft your linked account if the bank covers you when you spend more than you have. This service can also come with a fee, though you can avoid it by setting up low-balance alerts and linking your checking to a backup account.

Both products may charge other fees, such as a monthly account fee. With debit cards, you may be able to sidestep monthly fees by meeting certain requirements, such as maintaining a minimum balance.

Prepaid debit cards with no fees

Some prepaid debit cards have more favorable fee structures than others. Cards with limited fees include:

  • Bluebird® American Express Reloadable Prepaid Card: This card has no monthly fee and no fee for in-network ATM use. It also doesn't charge an inactivity fee, and you can do cash reloads for free at Family Dollar locations.
  • Navy Federal Credit Union GO Prepaid Card: This card, available even if you're not a member of Navy Federal Credit Union, has no monthly fee and no fee for in-network ATM withdrawals. A $1 monthly inactivity fee applies if you don't use the card for six months. Also, retailers may charge up to $5.95 for cash reloads.
  • Walmart MoneyCard: This card charges a $5.94 monthly fee, but it's waived if you made a direct deposit of at least $500 in the previous month. Users pay a $2.50 ATM fee but can withdraw cash for free at Walmart stores. Add money to your card for free with the Walmart app or for $3 at Walmart registers.

Be sure to review a card's full fee list before choosing it. A fee might not be a deal-breaker if the prepaid card is helping you save money, though lower fees are certainly ideal.

"I would say it's a minor concern," says Ralph Bender, certified financial planner and founder of Enduring Wealth Advisors in Temecula, California. "Because if you're paying a $10 monthly fee for the service, but it's preventing you from spending $400 extra on something, there's a trade-off there."

Do prepaid debit cards affect your credit?

Prepaid debit cards do not affect your credit. You won't undergo a credit check when you purchase a card, and your activity on the card won't be reported to the credit bureaus.

Pros and cons of prepaid debit cards


PROS

  • Offer more security than cash
  • Do not require a bank account
  • Can act as helpful budgeting tools

CONS

  • Does not help you build a credit score
  • Often charge a range of fees
  • May provide more limited features than regular debit cards and credit cards

When should you get a prepaid debit card?

A prepaid debit card can be useful in several situations. You may want to use one if:

  • You need to stick to a budget. Once you spend your balance, you can't use your prepaid card until you add money to it.
  • Let's say you're aiming to spend $100 monthly on entertainment. You could load a prepaid debit card with that amount and use it only for entertainment purchases.
  • Just make sure you don't set that $100 number randomly, though. Before getting your prepaid card, you could keep a spending log to get a sense of where your money's going and where you want to put up guardrails.
  • "That would be a real prudent thing, I would think, for somebody who has decided to take their spending seriously and get it under control," Bender says.
  • You don't want to carry cash. Carrying a prepaid card can be easier — and safer — than carrying a bunch of bills. A prepaid debit card isn't linked to your checking account to protect you in case your card is stolen.
  • Keep in mind that you can generally freeze your prepaid card if it's lost or stolen. Also, under federal law, you can limit your losses if you quickly report the card as lost or stolen.
  • You need a credit card alternative. You don't need a credit check to get a prepaid debit card.

How to add money to a prepaid debit card

To add money to a prepaid debit card, you can:

  • Set up a direct deposit.
  • Transfer funds from a checking account.
  • Buy a “reload pack” that is compatible with your card.
  • Visit a partnering provider, such as certain retailers or financial institutions.

You can often reload your card with cash at participating retailers and bank locations, but this type of deposit can come with a cash reload fee. The fee at Walmart stores is up to $5.95, for example, but you can reload for free using the Walmart app.

Adding funds from a check may also be an option, and this can be helpful for cashing a check without a bank account.

How do you cancel a prepaid debit card?

You'll likely be able to cancel your prepaid debit card through your online account, or call the card issuer's customer service. 

If you still have funds in your account, you may need to work with the issuer to get a refund.

How to choose the best prepaid debit card for you

To choose the best card for you, consider these factors:

  • How you plan to reload the card: If you primarily intend to reload with cash, for example, you'll want to prioritize a card with a low cash reload fee.
  • How often you plan to use the card: Some cards have monthly fees or inactivity fees, which may not be worth it if the card isn't an important piece of your spending plans.
  • How you use other financial products: If you already have debit and credit cards, carefully consider how this product fits into your financial picture. A prepaid debit card may be less appealing if you earn cash back on a credit card and you consistently pay off your balance on time and in full. 

You're not limited to using one card — just be sure that additional products make sense.

Alternatives to prepaid debit cards

Alternatives to prepaid debit cards vary depending on why you're considering the prepaid card. Here are some alternatives for different scenarios:

  • If your priority is budgeting: Multiple checking accounts could be part of an effective budgeting strategy. Depending on your situation, services such as nonprofit credit counseling could also be helpful.
  • If your priority is convenience: If you want a card but don't have a bank account, you could consider opening one. This step could help you get a debit card. Bank account benefits can include free access to checks, direct deposit and other services. You'll also be able to develop a relationship with a financial institution.
  • If your priority is practicing card use: If you're looking to get in the habit of using a card responsibly, you could look at a secured credit card instead of prepaid debit cards. With this product, you make a deposit, which may be equal to your starting credit limit. These can help you build a credit history.

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