Simmons defended the credit building aspect of the RushCard by telling me his average customer wouldn't be able to build credit otherwise. They're going from no credit to some credit, which is an improvement, he says. His hope is that eventually consumers will be able to qualify for a credit card and build a proper credit history and score that way. But, again, most lenders want to work with credit-worthy borrowers with a history of timely payments using a variety of different credit.
If you're underbanked and you want to establish and build credit, I would argue you're much better off doing so with a secured card. Your payment activity with a legitimate secured card gets reported to the major credit reporting bureaus and that in turn impacts your FICO score. I saw the survey. He has a point. But I have a traditional Bank of America checking account and I can't remember ever paying a fee just to have access to my money.
Yes, the bank has plenty of fees for out-of-network ATM withdrawals, transferring money outside the bank and overdraft protection - and the J.
Morgan survey assumes you're incurring one overdraft fee a month, plus one out-of-network ATM fee. It assumes RushCard users make eight purchases a month, and have 1. But if you're a conscious and educated banker you won't fall into those traps. It's also true that some BofA accounts require a minimum monthly balance to avoid a fee. While you will be building a positive credit history, it will have a limited benefit; it only helps you with the very small percentage of lenders who use LexisNexis and PRBC to make their credit-granting decisions.
The biggest drawback to the RushCard is its costs. There are two different RushCard plans to choose from, a monthly plan and a "pay as you go" plan. The fee structure for the two plans is different, but both plans have significant costs. There is a fee for activating your card. There are fees for using an ATM to withdraw cash and fees for simply making a balance inquiry. There are fees for getting a statement and for account maintenance.
There are fees for paying bills with your card. You also pay a fee each time you use your card to make a purchase. To its credit, the RushCard site has a list of all the fees it charges; it does not hit you with hidden fees. Advertiser Disclosure: The offers that appear on this site are from third party companies "our partners" from which Experian Consumer Services receives compensation. This compensation may impact how, where, and in what order the products appear on this site.
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Cash back at stores at no additional cost. Learn about secured credit cards. Cash reloads are possible only at third party locations, for a fee. See the best high-yield savings accounts. A prepaid debit card is a type of payment card that only lets you spend the money you load onto the card.
Like a debit card, a prepaid card works at any merchant that accepts its payment network, such as Visa, Mastercard or American Express. Usually the prepaid card has a mobile app to deposit checks and transfer money. Learn more on our guide to prepaid debit cards.
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