dcsimg

What is the best prepaid debit card out right now?

By , CardRatings Contributor

Our credit card articles, reviews and ratings maintain strict editorial integrity; however we may be compensated when you click on or are approved for offers (terms apply) from our partners. How we make money.

American Express is like that kid from your class who couldn't help but break the curve on every test. They don't mean to do it, they just crush everyone else's expectations and look puzzled when nobody else is playing at the same level. That explains why they've launched a prepaid debit card that's barely in the same league as their competition.

Before we cover the details, let's understand why American Express offers a prepaid credit card with such great terms for consumers. First, AmEx catches plenty of heat from merchants in "small transaction" categories, like gas stations, convenience stores, and fast food restaurants. They think American Express charges far too much in transaction fees, and their industry associations often complain in the press about whether they might stop accepting American Express. Offering strong rewards credit cards gives American Express leverage among frequent buyers, and an attractive prepaid debit card helps shore up demand among the rest of the consumer base.

Second, American Express still considers itself a "travel services company" more than a bank. Its purchase protection policies, fraud detection programs, and even its approach to replacing lost or stolen cards all emphasize customer service. Again, merchants may complain that all this service comes at higher transactional costs, especially when merchants have to bear the brunt of chargeback claims. Still, American Express' fans point out that accepting the company's cards gives businesses access to big spenders, especially the corporate expense accounts often tied to its gold and platinum accounts.

It's in that spirit that American Express offers an impressive prepaid debit card with unprecedented features. If you haven't been able to qualify for one of the company's charge cards, this really is the next best thing. You can even choose your favorite American Express color for your prepaid debit card: green, blue, gold or platinum. Each card carries a feature set that puts its competitors to shame:

  • No fees of any kind
  • Up to $1,000 purchase protection on every transaction
  • Free online account management
  • Free roadside assistance
  • Discounts, special offers and access to special entertainment pre-sales

The American Express prepaid debit card doesn't replace your bank, since you'll need to link it to an existing checking account. However, the company says in its marketing materials that it actively monitors prepaid card usage to determine whether or not you may qualify for a full-fledged AmEx card. Prepaid debit cards don't report usage on credit reports, but this is the only one we know of that can directly lead to a pre-approved credit card application.

0 Comments

Be the first to comment!

Start Here

Search. Compare. Apply.

Featured Partner Cards

loading
  How is your credit?
Oops! Your credit does not qualify you for this card. Applying and being rejected for this card could possibly hurt your credit
We are redirecting you to offers you are qualified for based on your credit.
720-850
Excellent
660-719
Good
600-659
Fair
350-599
Poor
X
CardRatings is excited to announce the launch of the
100% Free CardRatings Email Course to Learn How to Maximize Travel Rewards.

Created in partnership with ChooseFI

We partnered with ChooseFI to combine CardRatings’ offer expertise with ChooseFI’s tried and true travel rewards strategies. Get to know ChooseFI: they have changed tens of thousands of lives and recently won Podcast of the Year at FinCon.
You may think you are a rewards travel expert, but rewards strategies are changing (e.g., the days of card churning and manufactured spending are numbered). Learn powerful, sustainable strategies (a couple of which even you die-hard travel experts might not know). You'll be so glad you did.
We're planning more courses for the future; this is just the beginning of our journey.
BROUGHT TO YOU BY: