How Do Netspend Cards Work? (2024)

Netspend offers prepaid MasterCard and Visa debit cards requiring no minimum balance and no credit check. All transactions made using Netspend cards are insured by the Federal Deposit Insurance Corporation (FDIC) up to the current coverage limit, and the cards can be used anywhere MasterCard and Visa debit cards are accepted. Cardholders can make in-store purchases, shop over the phone and online, and withdraw cash at ATMs worldwide.

Founded in 1999, Netspend is a leading provider ofprepaid debit cards and commercial prepaid card solutions, with more than10 million customers servedin the U.S. There are several ways you can apply for a Netspend card. Once you receive your card, you can activate it online or via the phone, just like any other debit or credit card.

Key Takeaways

  • Netspend provides prepaid debit cards, prepaid Mastercard and Visa debit cards, and commercial prepaid cards.
  • Prepaid cards are different from credit cards in that you can only spend funds that you preload onto the card.
  • Netspend prepaid cards with Visa or Mastercard logos can be used wherever these forms of payment are accepted.

Understanding Netspend Cards

Prepaid debit cards, such as Netspend cards, differ fromcredit cardsin that you can only spend funds, which you have already preloaded onto the card. In other words, a Netspend card is not a credit card at all but simply a way of making funds that are already in your possession available via credit and debit card electronic payment technology.

Credit cards offer a revolving line of credit, which you can typically pay off over time. In addition, outstanding credit card balances accrue interest, which must also be paid off. With a prepaid card, you're spending your own money, whereas using a credit card is like spending borrowed money, which you are expected to pay back with interest at a later date.

Although different from credit cards, prepaid cards can still be used wherever Visa or Mastercard is accepted if the card has one of these logos.

Another difference between prepaid debit cards and credit cards is that many credit cards offer spending rewards in the form of points,cash back, orairline miles. Most prepaid cards, including theNetspend Small Business Prepaid Mastercard, do not. However, credit card holders typically have to spend a considerable amount on their credit card to really see rewards benefits.

The biggest similarity between prepaid debit cards and credit cards is that they usually have a card network logo on them like Visa or Mastercard. This means the card can be used at any place that accepts either of these methods of payment. However, one major difference is that using a Netspend card does not impact a person's credit score, such as a credit card does.

Getting a Netspend Card

Netspend applications are quick and simple, just requiring your name, address, and email address. All applicants are guaranteed approval once the applicant's identity is proven, and new cards are sent via mail within seven to 10 business days.

How to Use Netspend Cards

Netspend cards can be used just like credit cards or debit cards. You can choose credit at checkout and provide a signature, or you can choose debit and enter a PIN. Each purchase comes with a $1.95 fee regardless of which option you choose. Fees for ATM cash withdrawals are $2.95.

Individual transaction fees can be avoided by subscribing to premium Fee Advantage Plans, which charge $9.95 monthly. This fee can be reduced to $5 by having at least $500 direct deposited to your account each month.

How to Reload Funds

One of the best features of a Netspend card is how easy it is to add funds to the card. Funds can be added to Netspend accounts through direct deposit, bank account transfers, Netspend card account transfers, or through Netspend reload network locations. The only ways to add funds to the account without incurring fees are through direct deposit or through the Netspend online account center.

Four Benefits of Netspend Cards

  1. Separate business and personal expenses: The main reason to get a prepaid business card is it allows you toseparate personal expenses from business expenses. This makes life easier at tax time.
  2. Manage employee (and personal) spending: A prepaid debit card is a perfect tool for managing the spending of other employees, as you can ensure that nobody using it spends more than you want. With the Netspend Small Business Prepaid Mastercard, you can distribute funds to up to 10 sub-accounts. Spending on a Netspend account is also capped at $5,000 each day. Just remember that additional sub-accounts will cost you $1.95 each per month.
  3. Allows for business card use: Running an entirely cash business makes it very difficult to keep track of your money. A prepaid debit card at least allows you to allocate cash for business purposes in an organized way. A prepaid card may also come in handy for business expenses that can’t be paid for in cash.
  4. No credit check: No credit check is required for most prepaid business debit cards. All it takes to receive a Netspend Small Business prepaid card is a short application and an ID.

How Do You Put Money on a Netspend Card?

There are multiple ways to add money to a Netspend card. There is no fee for direct deposits, mobile check uploads, or transfers from a connected bank account. Fees vary for account deposits via Netspend reload locations or Western Union.

How Much Does Netspend Charge You to Use the Card?

Each purchase comes with a $1.95 surcharge whether you use the card as a debit card or a credit card. This fee is waived if you sign up for a $9.95 monthly plan. The fee for the monthly plan is reduced to $5 if you have at least $500 direct deposited to the account each month.

Is Netspend a Real Debit Card?

It's a real debit card in the sense that it can be used just like a debit card. What many people traditionally think of as a debit card is tied to a bank account that must be funded for the debit card to be useful. Netspend cards also must be funded for use.

The Bottom Line

Netspend offers prepaid debit cards with Mastercard or Visa branding. Cards can be funded in ways that are similar to how one might manage an online bank account. However, the fees associated with Netspend, whether it is pay-as-you-go or part of a monthly plan, are far greater than what you can get from a typical online bank.

How Do Netspend Cards Work? (2024)

FAQs

How Do Netspend Cards Work? ›

The Netspend Prepaid Card works like a traditional debit card, except it doesn't draw funds from a linked checking account. Instead, you must add, or “load,” funds onto the card before you can use it to make purchases or withdraw funds from ATMs. Using the Netspend prepaid card means paying fees.

What are the cons of Netspend? ›

Excessive fees: Maintenance and activity fees will cost you

With the Netspend Visa Prepaid card, even if you qualify for the $5 lower monthly fee, you'll be spending $60 annually just to hold and use.

How do I put money on a Netspend card? ›

Bank Transfers: Add money from virtually any U.S.-issued bank account. If you have a checking or savings account or a bank debit card, use it to add money. A fee may be assessed for the use of this feature. Debit Card Transfers: Add money from a personal debit card to fund your Netspend Account.

How do I spend money on my Netspend card? ›

Netspend cards can be used just like credit cards or debit cards. You can choose credit at checkout and provide a signature, or you can choose debit and enter a PIN. Each purchase comes with a $1.95 fee regardless of which option you choose. Fees for ATM cash withdrawals are $2.95.

What is Netspend and how does it work? ›

Netspend is a company with prepaid cards that offers an alternative to checking account debit cards, credit cards, and cash. Netspend makes its money through a variety of fees, such as the monthly plan fee, transaction fees, ATM withdrawal fees, replacement card fees, and inactivity fees.

Why would someone get a Netspend card? ›

What Is Netspend? Prepaid cards can help those unable to open a bank account, but beware of the fees. Some consumers are not able to open a checking account at a bank or credit union to pay their bills or purchase groceries or other items and are forced to rely on using prepaid debit cards.

How much is the Netspend monthly fee? ›

Summary of fees:
Type of FeePay-As-You-Go PlanMonthly Plan
Plan fee$0$9.95 per mo.
Per purchase$1.95$0
ATM withdrawal$2.95$2.95
Cash reload$3.95*$3.95*
3 more rows

How much money can I put on my Netspend card? ›

You can load a maximum of $2,500 on a NetSpend card over any 24 hour period. This is the maximum cumulative amount of in store cash value loads. The maximum amount for direct deposits and tax refund ACH deposits is $15,000.

Is netspend legit? ›

Great banking alternative

I have used this card for over a year as a primary bank account. I get my direct deposits early like a day or two early. My husband and I both use the account with both of our earnings being deposited. They will even supply several additional cards.

Why is Netspend holding my money? ›

Gas stations, hotels, and car rental agencies frequently preauthorize a transaction, which means they place a hold on your account until they know the final amount owed.

Why does Netspend ask for a social security number? ›

1 IMPORTANT INFORMATION FOR OPENING A CARD OR DEPOSIT ACCOUNT: To help the federal government fight the funding of terrorism and money laundering activities, the USA PATRIOT Act requires us to obtain, verify, and record information that identifies each person who opens an Account.

How do I get money off my Netspend card? ›

How to Withdraw Money From Your Netspend Card
  1. Visit a bank or credit union. Take your Netspend card to your local bank or credit union, and you should be able to get cash by speaking to a teller. ...
  2. Withdraw money from an ATM. ...
  3. Get cash back from a retail store.
Nov 23, 2023

Where can I load my Netspend card for free? ›

Key Takeaways
  • Global payment company Netspend offers a prepaid debit card that allows the cardholder to make electronic payments online or in person.
  • Account holders can reload their card in person at participating retailers like CVS, Walmart, and 7-Eleven.
Apr 21, 2024

How do I add money to a Netspend card? ›

Bank Transfers: Add money from virtually any U.S.-issued bank account. If you have a checking or savings account or a bank debit card, use it to add money. A fee may be assessed for the use of this feature. Debit Card Transfers: Add money from a personal debit card to fund your account.

What is the minimum balance for Netspend? ›

The APYs were accurate as of 4/1/2024. There is no minimum balance to open the Savings Account or obtain the yield(s). Savings Account funds are withdrawn through the Netspend® Debit Account (maximum 6 such transfers per calendar month) and transaction fees could reduce the interest earned on the savings account.

What happens if you don't use your Netspend card? ›

If there has been no activity on an account for 90 days, Netspend will begin charging a $5.95/month inactivity fee. If you have a monthly plan and are inactive for 90 days, this fee will replace the fee for the monthly plan.

Can Netspend be trusted? ›

Netspend Prepaid Card Reviews and Complaints

Netspend currently holds a 4.1 out of five stars rating on TrustPilot, with over 11,000 reviews.

What are the downsides of using a prepaid card? ›

Disadvantages. Pre-paid debit cards do not help you build credit. Many pre-paid debit cards charge fees before you even start using them. There is usually a monthly fee and fees on common transactions such as ATM withdrawals, card replacement, direct deposit, and reloading the card.

Does Netspend affect credit score? ›

Not at all! The Netspend® Better Credit Visa Card doesn't report percent utilization to the major credit bureaus because it has no pre-set credit limit. That means spending up to the amount you added will not show a high-utilization card on your credit history.

How negative can you go on Netspend? ›

Key Takeaways. Netspend offers prepaid debit card users overdraft protection when their account balance goes under -$10.01. Customers must enroll and have at least one direct deposit of $200 or more every 30 days.

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