NEW YORK (5/20/13)--A study of 24 widely issued prepaid debit cards indicates all charge fees of some kind. However, two-thirds either have no monthly fee or offer a fee waiver.
The fees vary widely by card and how the consumer uses it, said Bankrate.com
, which conducted the survey in February. Credit union prepaid debit cards were not among those in the study.
"The biggest development in the prepaid card market over the past year was the entry of several large national and regional banks," said Greg McBride, senior financial analyst at Bankrate.com
. Many offer cards with fixed monthly costs. "The ability to know the monthly cost in advance is valuable to consumers, particularly with the decline in free checking accounts," McBride said.
Only 39% of banks offer stand-alone free checking accounts. That compares with 72% of credit unions, according to a previous Bankrate.com
In the prepaid debit cards study, 15 cards (63%) charged a monthly service fee of $3 to $9.95. Eight of these offer either a fee waiver or fee reduction, based on how much is automatically loaded onto the prepaid card.
Other fee findings:
- Activation fees: Two-thirds of the cards have no activation fee if purchased online, and 54% can be purchased in person with no fee. The fees are $2.99 to $14.95.
- Reload fees: None of the cards charged reload fees.
- ATM withdrawal fees: All cards charged a fee, which ranged from $1.50 to $2.75 per transaction, to withdraw from another institution's ATM. Fifteen cards have their own ATM networks. Of those, 67% charge in-network consumers between $1.50 and $2.75.
- ATM balance inquiry fees: Fifty-four percent of the cards charge this fee, which ranges from 45 cents to $1 regardless of which network the ATM belongs to. Of the remaining 11 cards, five charge this fee at some ATMs, four don't charge at all and the other two don't permit ATM balance inquiries.
- PIN/signature point-of-sale (POS) fees: Roughly 71% don't charge for PIN POS transactions, and two don't permit this type of transaction. The five cards with this fee charge from 49 cents to $2. Twenty of the 24 cards, or 83%, do not charge a signature POS transaction fee. Those that do, charge 95 cents to $1.
- Monthly statement fees: Fifty-eight percent of cards charge $1 to $5.95 for monthly statements by mail, 33% don't charge the fee and 8% don't offer mail statements. None of the cards offer a statement that can be printed at an ATM.
- Bill payment fees: Twenty-two cards (92%) do not charge this fee. One assesses 99 cents for each payment and another charges $1 for bills paid via paper checks.
- Customer service fees: Of those surveyed, 17% charge for customer service calls, with $2 the most common fee, and 88% provide at least one free call per month. Two-thirds never charge for telephone customer service.
- Declined transaction fees: Fifteen cards--63%--do not charge for declined transactions. Five (21%) assess 25 cents to $1.95 for each declined transaction. Four charge only for transactions declined at an ATM; they assess $1 or $2.
- Inactivity fees: In the study, 29% of the cards charged an inactivity fee, ranging from $1.95 to $5.95 after 90 days of inactivity, and 71% don't charge the fee but may close the card after three to six months of inactivity.
For a list of cards with their specific fees, use the link.