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5 prepaid debit card pitfalls to avoid

Debit Cards » Best Prepaid Debit Cards » 5 Prepaid Debit Card Pitfalls To Avoid

Card loss or theft
© Anna Ewa Bieniek - Shutterstock.com

Loss or theft is another possible threat to prepaid debit card holders' funds.

Currently, federal law doesn't require prepaid debit card providers to refund money lost through fraud, but many providers do so voluntarily. However, you can only take advantage of that protection if your card is registered, Feltner says.

"Many cards are what's called 'unregistered debit cards,' which are not attached to your name, Social Security card or date of birth," Feltner says. "If you're holding the card, then you can spend money on the card, and if you lose it, you're out of luck."

That changes if you go through the simple registration process offered by many card providers, he says.

"Most of the major prepaid debit card providers give you the option of purchasing a card, say at Walgreens or at a supermarket, and then registering that card online or calling to register that card to give them your full name, your date of birth, your Social Security number and all the information they need to be able to prove that you're you," Feltner says.

"Once you've done that, you can typically request a replacement card and, with many providers, are subject to all the same loss-prevention protections that normally come with a debit card," he says.

 

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