“A prepaid debit card is a gateway solution for unbanked consumers when there’s little to no access to safe or low-cost banking alternatives,” said Renee Jones, vice president of product management at Georgia’s Own Credit Union. Prepaid debit cards often operate similarly to a checking account - just watch out for reloading fees, ATM withdrawal fees and monthly costs. Unlike with credit cards, you can’t overspend beyond the amount you load onto the card.
Prepaid debit cards don’t require a credit check, making them a more accessible option than credit cards, and most allow you to withdraw cash from ATMs. If you don’t have access to a conventional banking service and need a payment alternative, a prepaid debit card could be an option for you. Nearly 5.9 million US households are “unbanked,” meaning no one in the home has a checking or a savings account, according to a 2021 Federal Deposit Insurance Corporation survey.
