The Worst Cash Rip-Off Since Bank Fees? Behold an Infuriating New Scheme to Sap Your Money

[xchrom]

http://www.alternet.org/worst-cash-rip-bank-fees-behold-infuriating-new-scheme-sap-your-money



Lately I’ve been writing about the little indulgences we all pay to the financial services industry, just for the privilege of using the money we earn or making sure we can survive in a 21st-century world. If we want a bank account that complies with laws against hidden charges, we have to pay a fee. If we need to borrow a little money to make ends meet, we can get trapped in a cycle of debt. Even if we’ve done nothing wrong, predatory financial operators can come after us for debts we don’t owe.

Now, just when consumers think they’ve found a way out, a way to beat the system, the industry remains a step ahead.

Prepaid debit cards, which can be repeatedly reloaded with money and used to make purchases anywhere, have grown in popularity. Roughly 12 million customers loaded around $65 billion onto these cards in 2012, over twice the amount in 2009. This gives people an easy way to make purchases online and do all the things for which modern society demands a debit card.

The reloadable nature of the prepaid card, with the money securely stored and available to be used in any capacity, means it can function as a substitute checking account. Some cards even allow direct deposit and online bill pay. In fact, research from the Pew Charitable Trusts finds that, contrary to assumptions, most prepaid card users have used traditional financial services before. “Seven out of eight either have or used to have a checking account,” said Alex Horowitz, a research officer at Pew. The cards have become an alternative, rather than a first step into the financial mainstream.

[chervilant]

1. We sheeple need to understand viscerally:

Banks always, always, always, always -- have I said always enough? -- ALWAYS get their money (ALL monies are their monies -- please try to grasp that fact).

[xchrom]

3. +1

[Takket]

2. I considered one of these recently

After my debit card was compromised by target. I decided the fees were just too much and use my credit card instead. The only fee I was worried about was the five dollar monthly fee. Many cards have different fee structures. Check with your personal bank to see their details. Some banks waive monthly fees if you do direct deposit but I did not want to do that as the whole point of me wanting to replace my debit card was to avoid using a card tied to my direct deposit from work so if the card was compromised someone could not empty out my checking account when I get paid. In the end I just used a credit card and make payments online once a week to cover what I've spent.

[Glitterati]

4. And, some corporations like Walmart REQUIRE employees to get their pay on one

The Walmart brand pre-paid card, of course.