The nation's biggest bank is getting in on the big boom of prepaid cards.
Chase announced Tuesday its new Chase Liquid card, a prepaid debit card that will be nationally available this summer to all consumers. Even if you don't have a checking or savings account at the bank, you're still eligible for the card.
Unlike many of the prepaid cards my colleagues and I have covered, the new Chase offering seems relatively fee-friendly. There is a $4.95 monthly charge for the card, but cardholders will not be nickeled-and-dimed for checking balances, refilling their cards or speaking with customer service representatives. They also have free access to the Chase ATM and branch networks.
Andrew Johnson and Robin Sidel at The Wall Street Journal raised a good point in their recent coverage of the new card: It will be cheaper than the bank's basic checking account for some consumers. When Chase checking account holders fail to meet minimum balance requirements in a given month, the bank slaps them with $12 worth of fees.
In Tuesday's statement, Chase says the card "provides consumers better value than other reloadable cards and nontraditional financial services providers." Translation: The banking giant is competing with the check-cashing stores that currently serve the unbanked population. It's no surprise banks are working to diversify their products as the prepaid business continues to soar in popularity -- and profitability.
While the bank may be hoping to cash in on attracting an entirely new audience, I'm curious to see who will take advantage of the card. Some of our readers have pointed out that avoiding fees is not the only part of the equation that adds up to choosing prepaid cards over traditional checking accounts. Instead, many unbanked customers simply do not trust the banking industry.
What do you think of the new offering? Will it help the nation's biggest bank grow even bigger?