A lot of people can’t open traditional banking accounts. Issues like bad credit, being listed in the Telecheck system, or problems with overdrafts can all make people ineligible.
It’s a challenging situation to overcome. Luckily, a bank account alternative may offer a solution.
NetSpend is a bank account alternative that can help the unbankable get things done. It’s also an option for people who can open accounts, but prefer to use another route.
If you are wondering whether NetSpend is the perfect bank account alternative for you, here’s what you need to know.
What is NetSpend?
NetSpend is a company that offers prepaid debit cards and interest-bearing savings accounts. They provide an alternative to traditional banking.
Predominately, they market their offerings to the those with poor credit. However, anyone can use NetSpend if they so choose.
NetSpend doesn’t require credit checks. Plus, you can purchase or reload a NetSpend debit card at a wide range of locations. You can view information about your account through their mobile app, and even deposit checks.
How Much Does NetSpend Cost?
There are a lot of fees that come with using the NetSpend debit card. For example, the Pay-As-You-Go plan doesn’t have a monthly fee, but every signature or pin transaction will cost you $1 or $2 respectively. If you want to avoid those transaction fees, you’ll need a monthly plan, and that will cost at least $5 a month.
Cash withdrawals also have fees, though they vary dramatically depending on where you pull out the money. Additionally, if you use an ATM and don’t have enough money, you’ll have to pay a decline fee of $1.
What About Their Reputation?
NetSpend doesn’t have a good reputation. Currently, their Better Business Bureau rating is an F. Also, they are not BBB accredited.
The company has also had some legal trouble. They had to settle with the Federal Trade Commission over making false claims about their product in March 2017. Some of the settlement was sent to customers who were impacted by NetSpend’s actions.
Are There Other Bank Account Alternatives?
Yes. NetSpend is not the only bank account alternative on the market. For example, Green Dot and Bluebird offer similar services.
Green Dot has an A rating with the BBB. Bluebird, which is an American Express product, doesn’t have a separate BBB ranking. Instead, they would fall under American Express’s A+.
Is NetSpend the right bank account alternative for you? Probably not. There are better products out there, including ones with lower fees and better reputations.
If you’re looking for a bank account alternative, consider examining Bluebird and Green Dot first. You’ll likely be thankful that you did.
Have you ever used a bank account alternative? Tell us about it in the comments below!
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Tamila McDonald has worked as a Financial Advisor for the military for past 13 years. She has taught Personal Financial classes on every subject from credit, to life insurance, as well as all other aspects of financial management. Mrs. McDonald is an AFCPE Accredited Financial Counselor and has helped her clients to meet their short-term and long-term financial goals.
