There is a lot of discussion in the news today regarding banking and prepaid card fees. Fees vary widely depending on the service provider, and often the best choice of a financial services solution, whether to get a bank account, a prepaid card or to simply cash your check and use cash depends on the person and how that person transacts on a daily basis. It may also depend on what options are available to the person at the time as well.

The choice of whether or not to get a bank account is not always a choice for thousands of individuals in the United States. Lack of proper identification, minimum balance requirements, a history of bad checks or bad credit history may all prevent someone from even having the option to open a bank account. For these people, a prepaid card offers a safer way to transact versus carrying around cash. Prepaid cards also offer, in many instances, a less expensive way to transact.

We would like to provide you with an overview of fees in the industry, comparing three alternatives, a bank checking account, check cashing and the MiCash Prepaid MasterCard.

The pricing for a bank account and for using cash in the chart above are estimations based on market information. Additional charges for other services may also apply. Please note that prices vary and these only represent averages.

Watch Out for Overdrafts

As you can see from the chart above, after the first month, the cheapest on-going solution is the bank account given the pricing we have included above. However, it is only the least expensive solution if the customer does not incur an overdraft on their account. While banks are under increasing pressure to lower their overdraft fees, they still represent a significant cost to the account holder, and when an overdraft does occur, it typically is followed by additional overdrafts that same day which lead to additional charges.

The MiCash Prepaid card solution is only slightly more per month than a checking account with the fees we have listed and in some cases may be less, and overdraft charges are minimal. In fact, it is difficult to overdraft a prepaid card. If there are insufficient funds to cover a charge, the transaction is declined. This is an appealing feature to many people who have been hit with a $15 – $35 overdraft fee from their bank for a charge that may have only been $5.00 at the drive-through.

Transferring Money

Additionally, if someone is transferring money internationally, the MiCash Prepaid MasterCard may be the best solution. MiCash offers a free companion card to all cardholders. Cardholders may share the MiCash companion card with anyone in the US or abroad and share money from their card to the companion card. MiCash Companion cards are accepted worldwide and may be used for PIN point-of-sale purchases or to withdraw money at ATMs. 

Compare the Alternatives

So what does all of this mean? People should compare the alternatives. They should understand how they would use a bank account, a prepaid card or cash. They should ask the following questions.

• Do I usually spend all of the money I make every month and have trouble maintaining a minimum balance?
• Have I had trouble with overdrafts in the past?
• Do I have less than perfect credit?

If yes, then a prepaid card, like the MiCash card may be a good solution. And, while one solution might work for someone today, it is important to understand the alternatives and make the best decision given the circumstances.