Best Prepaid Cards: Top Debit Card Alternatives

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Are you in the market for a prepaid card?

There is a segment of the population who may not want or have access to a rewards credit card or secured credit card. And they may not want the transactional risk of a traditional bank’s debit card.

That leaves a prepaid card as a top option for non-cash transactions. This type of card is not attached to a bank account, so you can make transactions in person and online without having to worry about overspending or running up debt.

But you’re not just limited to the “prepay-and-reload a gift card” style of card anymore. You can make direct deposits and earn rewards like you might with a traditional banking relationship.

And there are emerging options in the space, including “cash” or “debit” cards that draw off your online balances from services like PayPal, Venmo and Apple Cash. This could allow you to fund a fully functional debit card without needing a bank account.

You’re probably wondering: Which options are good? And which are rip-offs?

In this article, we’ll look at some of the best prepaid card options. You can read our methodology to understand how we evaluated the market to compile this list.


Table of Contents


Best Prepaid Cards

For the purposes of determining the “best” options, I have broken things down into two categories: Traditional preloaded cards and digital wallet-backed cards.

Some of you may have arrived at this article looking to stay “off the online financial grid” with your prepaid card. You may prefer to go to a physical store and buy a traditional prepaid card with cash. We’ll rate the best options to do that.

Others may be OK with setting up a non-bank online presence to fund your prepaid endeavors via a digital wallet. This may require some extra hoops to jump through, but it may also save you on monthly fees. We’ll rate the best options to do this, too.

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Traditional Preload Cards

Alternative Options: Digital Wallet-Backed Cards


What Is a Prepaid Card and Why Would You Need One?

A prepaid card is a physical credit card that you load money onto in advance of spending with it. Many of them function like a gift card in that you can only spend the amount of money that has been placed on the card.

The funding of these cards is usually done in one of the following ways:

  • Loading cash onto the card at a retailer or bank
  • Transferring money from an existing bank account
  • Setting up direct deposit from your paycheck (as a reloading option)
  • Purchasing a reload card to add a specific amount to the existing card

While these cards are not the same as a traditional credit card or debit card, they CAN spend like one for in-store and online transactions.

Many of them include either a Visa, Mastercard, American Express or Discover logo and can be used wherever those cards are accepted.

So what’s the reason to have one of these over a traditional debit or credit card?

The top reasons someone might use a prepaid credit card include:

  • Unable to qualify for a traditional credit card or bank account
  • Safely making purchases online
  • Preventing credit card debt
  • Avoiding spending too much
  • Avoiding overdrafts

When choosing whether a prepaid card is right for you, there are some pros and cons to consider:

ProsCons
Safer than carrying cashUsually don’t earn interest on balance
No credit check requiredMonthly fees can add up
Can help you avoid overspendingWon’t build credit history with usage

Methodology

For the purposes of this article, I isolated the options to prepaid cards and non-bank account cards only.

That means we did not include any of the following:

  • Rewards credit cards
  • Secured credit cards
  • Store credit cards
  • Debit cards that require a bank account

When selecting which prepaid cards are “best,” I focused on the following factors:

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  • Activation fees
  • Monthly fees
  • Deposit options
  • Reload fees
  • Rewards earning potential
  • Card acceptance
  • Direct deposit availability
  • ATM withdrawal access

Do you have a prepaid credit card? How did you make your choice? We’d love to hear about your experiences in the Clark.com community.

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