(UPDATE: The Capital One Prepaid card is no longer available.) 

With the rapid proliferation of prepaid cards, we here at MyBankTracker figured it was time to figure out exactly who might benefit from using them. Turns out that if you’re in a tough spot — kinda broke, say — they’re for you. It also turns out that one of the more reviled products, Suze Orman’s Approved Card, may be the best deal available to the working poor.

The growth in prepaid debit cards shows no sign of slowing down. In fact, the cards are becoming mainstream. Russell and Kimora Lee Simmons aren’t the only famous people hawking prepaid cards these days: George Lopez just partnered with the Mango Card, famous financial advice-giver Suze Orman released her own card recently (although it was pilloried by personal-finance bloggers for its apparently steep fees and spurious claims about credit scores.) Even Capital One — which historically dealt with the subprime market — and American Express — which did not — have prepaid cards on offer.

Just what and whom are they for?

While a checking account is a checking account with little variation across the board, save for fees and perks, prepaid cards are all over the place. Some have savings accounts, and some do not. Some charge for swipes, and some do not. Some, like the cards from Account Now, are flagrant rip-offs, and some are not.

Because of the wide variety in services and fee schedules, prepaid cards can be difficult to compare. Despite all this, we’re going to try our best to evaluate some of the more notable cards. Check out the chart below:

Service/FeeAccount Now
Account Now (Gold w/o Direct Deposit)
Account Now
Account Now (Classic)
American Express prepaid
American Express Prepaid
Suze Orman Approved card prepaid
Approved Card from Suze Orman
Capital One Prepaid Gold
Capital One Prepaid
Greendot Prepaid Visa
Green Dot
Activation-$4.95-$3-$4.95 ($6.95 for NASCAR branded card)
Monthly Fee$9.95--$3Free with $500 in loads/ $4.95 otherwiseFree with $1,000 in loads or 30 purchases per month/$5.95 otherwise
ATM Withdrawal$2.50$2.501 free per month, after $2$2 (Allpoint ATM fees waived with direct deposit > $20)1 free per month/$1.95 afterFree in network/$2.50 otherwise
ATM Balance Inquiry$1$1-$1 (Allpoint ATM fees waived with direct deposit > $20)-$0.50
Transaction Fee-$1 (PIN or no PIN)----
Customer Service Call$1$1-1 free per month/$2 after--
Paper Statement---$2$1.95-
Replacement Card$10$10-$3-$4.95
90 Day Inactivity Fee------
Int'l Currency Conversion Fee2.95%2.95%--1%3%
Perks?Merchant based rewards programMerchant based rewards programAmEx discounts, roadside assistance, advance tickets, etc.Free access to TransUnion credit score--
Estimated Monthly Usage Cost*$29.90$31.95$14.95$19.95$14.70$18.40
Mango Prepaid
Net Spend Pay As You Go
Net Spend Fee Advantage
Net Spend Premier Fee Advantage
RushCard (Monthly Plan)
RushCard (Pay As You Go)
Activation----$3.95 - $14.95 (depends on card)$3.95 - $14.95 (depends on card)
Monthly FeeWaived with $500 in loads/$5 otherwise-$9.95$5$9.95-
ATM Withdrawal$2$2.50$2.50$2.502 free per month/$2.50 after$1.95
ATM Balance Inquiry$0.50$0.50$0.50$0.50$0.50$0.50
Transaction-$1 PIN/$2 no PIN--$1 PIN/$0 no PIN$1 (capped at $10 per month)
Customer Service Call------
Paper Statement-$4.95$4.95$4.95$1$1
Replacement Card-$9.95$9.95$9.95--
90 Day Inactivity Fee-$5.95$5.95$5.95-$1.95
Int'l Currency Conversion Fee2%3.5%3.5%3.5%2%2%
Perks?5% APY savings accountMerchant based rewards programMerchant based rewards programMerchant based rewards programDiscounted health plansDiscounted health plans
Estimated Monthly Usage Cost*$14.95$37.95$29.90$24.95$30.90$26.65

*Estimated Monthly Usage Costs calculated thusly: One $500 MoneyPak load ($4.95), six ATM withdrawals (half in-network, half out-of-network), and 12 purchases (six PIN, six signature). Does not include activation fee. 

CapOne, Amex take the lead

Established players like Capital One and American Express offer excellent deals on prepaid products. Those cards have strong competition from Mango, Green Dot and Suze Orman’s Approved Card, however. The Mango card is likely the fiercest competitor among the new players, with similarly low fees and something that even major banks don’t offer anymore: a high-yield savings account.

There is no argument to be made in favor of products like NetSpend, Account Now or the RushCard. The fees are simply exorbitant.

Checking looks better…unless you’re broke

Compared to a checking account, many prepaid cards look attractive, at a glance. On average, checking account have $15.05 in monthly maintenance fees, and an average of $2.20 in fees for out-of-network ATM swipes. Assuming customers use an out-of-network ATM three times a month (that’s the same criteria we used for the prepaid cards), it costs $21.65 a month to use a checking account. The American Express, Capital One, Mango, Green Dot and even Suze Orman’s card are cheaper than that!

However, this doesn’t take fee waivers into account. According to our averages, banks won’t charge you monthly fees if you keep around $1,600 in your checking account. Should you find yourself comfortably above that line, you’ll never spend more than a few bucks a month on out-of-network ATM fees. So add a little bit of a cushion and there’s no reason to think about prepaid cards if you can keep about $2,000 in your checking account.

But, for those who are teetering on the brink, some of the better prepaid cards actually make sense. Used wisely, they might be substantially cheaper than checking accounts for those who can’t meet monthly minimums.

A word on direct deposit and Suze Orman

One thing that may surprise is that Orman’s Approved Card, which I personally trashed on this website months back, is an attractive option for the working poor — the most attractive of all, in fact.

If you work at some low-skill retail job, earning minimum wage, and are limited to part-time hours, you might get a paycheck of, say, $400 every two weeks that could be paid through direct deposit. The Approved Card waives its in-network ATM fees for those who use direct deposit, making it potentially cost only $3 a month for access to electronic cash. That’s substantially cheaper than check cashing or a checking account for someone with less than $2,000 to their name.

It’s a small niche, but Orman nailed it. Why didn’t she just come out and say her card is for the working poor?

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  • Mark

    So, this means that you are an idiot for trashing Suze’s card?

    • Great question, Mark. Can’t say I have the answer to it. 

    • kica

      Name calling??? Really?  At least he was honest enough to admit his mis-judgement (sp)

  • LaRhonda

    I would say he’s not an idiot…in most cases, one can go to a bank with that same $400/month on direct deposit and avoid fees.  I use a bank of america account to make deposits and transfer them to my ING direct account.  I have my job direct deposit $95 on the 15th and last day of each month.  I pay no fees and don’t carry a balance of more than $500 at any time (mostly less than that).  And that’s with BofA.  WHo knows what you could find at other banks.  I say rather than paying ANY fee, check on backs and credit unions who don’t charge fees.  If you’re online, try ING direct.  Get interst on checking and savings and there are no minimum balances.  Suze’s card may be the the lesser of several evils, but I know people can do better at some regular banks/credit unions.  Just have to check around and do a little leg work.

  • Kurtis

    In a time when most people including our government is in incredible debt, I’m excited about the idea that Suze Orman is promoting – that we should all be making purchases we can afford.  And in most cases, using a prepaid card rather than credit to do so.  
    I have The Approved Card and would not consider myself the “working poor”.  So far, this card is working perfectly for my needs as I look toward 2012 & my personal goal of spending based on what I need & not what I want.  

  • Rosepetal0820

    You’re an idiot–she did come out and say it was for those who didn’t have money, despite working their asses off! Media simply loves to blow things out of proportion, rather than listening…typical.

  • Lisa C.

    He forgot to mention that most of those prepaid cards dont send info to the 3 credit reporting agency’, suze Ormans does and helps to re-establish credit… I love the card so far so good very happy to be a recipiant of it..

    •  Uh, no, her card does not report to the credit bureaus.  Read the fine print please.  From her site..
      “The information we share with TransUnion concerning your Approved Card account will not appear in your credit report.”

      “Use of The Approved Card will not and cannot improve or fix your credit score or rating.

      • Exactly, John. Thanks for the comment.

        It was this (sort of sneaky) marketing tactic, I think, that didn’t do much to ingratiate journalists and bloggers to her product. That said, there’s a certain group of people for whom it works as a way of accessing cash electronically, which is very important.

  • The best thing about Suze’s card is she is working to get this card reported to the 3 major credit bureaus, which is the downfall of paying for everything with cash. Hopefully she can get this off the ground in a year or so. Good job Suze!!

  • Jessica

    Where Suze didn’t nail it is glossing over the fact that prepaid debit cards do not affect the FICO Score now and they won’t for at least the next 2 years. She neglected to highlight that until the backlash came at her. Then she was much more open about the fact that it’s all a “test” to see if it’s possible. Most in the financial community will tell you that it’s not possible.