What a prepaid card is and how to get one
A prepaid credit card is a card you load money onto before you use it — you cannot spend more than the balance you have already put in. You buy the card itself (usually $5 to $10 at a retailer or online), load it with cash or a bank transfer, and then use it like a regular card at stores and online. Unlike a debit card tied to a bank account, a prepaid card is separate from any bank.
Getting one takes 10 to 20 minutes. You choose a card brand (Visa, Mastercard, or American Express prepaid cards are most common), buy it in person or order it online, verify your identity if required, and load your first balance. Some cards let you load money when ready; others take a day or two to set up.
The main reason people use prepaid cards is control — you cannot overspend, and you do not need a bank account or credit check. They are also useful if you do not have a Social Security number, want to keep spending separate from your main bank, or need a card for a teenager.
Key Takeaways
- Prepaid cards are sold at retailers like Walmart, Target, and CVS, or ordered online from card issuers like Netspend, Green Dot, and Chime.
- You pay an upfront fee ($5 to $10) to buy the card itself, then load money onto it before use.
- Most prepaid cards charge monthly maintenance fees ($5 to $10) and per-transaction fees for ATM withdrawals or customer service calls.
- Prepaid cards do not build credit history because they are not credit products — they are spending accounts.
- You will need to provide your name, address, and sometimes a Social Security number or tax ID to set up the card.
Where to buy a prepaid card
Prepaid cards are sold in two places: physical retailers and online directly from the card issuer.
Retail locations stock prepaid cards in the checkout area or gift card section. Walmart, Target, CVS, Walgreens, and grocery stores all carry them. You walk in, pick a card (Netspend, Green Dot, Chime, or a bank-branded option), pay the set up fee at checkout, and take it home. You can load money onto it when ready using a PIN or online account, or sometimes right at the register.
Online ordering is faster if you want a specific card brand. Go to the issuer's website (Netspend.com, GreenDotBank.com, Chime.com), order the card, and it arrives in 5 to 10 business days. You set up it when it arrives and load money the same day. Some issuers offer a temporary digital card you can use while waiting for the physical one.
The card itself costs $5 to $10 whether you buy it in a store or online. Some retailers occasionally waive the fee, so check the packaging or website before you buy.
How to set up and load money onto your card
set up happens in two steps: registering the card with the issuer, then loading your first balance.
To register, visit the issuer's website or call the number on the back of the card. You will enter the card number, your name, address, date of birth, and sometimes a Social Security number or tax ID. This takes 5 to 10 minutes. Some cards let you register in a mobile app instead. Once registered, the card is active and ready to use.
To load money, you have several options depending on the card. Most cards accept bank transfers (you link a checking account and transfer funds), direct deposit (your employer deposits your paycheck onto the card), or cash loads at retail locations (you hand cash to a cashier at Walmart or CVS and it goes onto the card when ready). Some cards also accept transfers from other prepaid cards or payment apps like PayPal.
The first load usually posts within minutes if you use a retail cash load or bank transfer. Direct deposit takes 1 to 2 business days. Check your card's app or website to see your balance once the money arrives.
Fees to expect with prepaid cards
Prepaid cards charge more fees than a regular bank account, so understand them before you choose one.
set up fee: $5 to $10 to buy the card itself. Paid once.
Monthly maintenance fee: $5 to $10 per month just to keep the card active. Some cards waive this if you load a certain amount each month (usually $500 or more) or use direct deposit. A few cards have no monthly fee at all.
ATM withdrawal fee: $1 to $3 per withdrawal if you use an ATM outside the issuer's network. Some cards offer free withdrawals at certain ATMs (like MoneyPass or Allpoint networks) or let you get cash back at stores for free.
Customer service fee: $1 to $2 per call to customer service. Online chat or app support is usually free.
Inactivity fee: Some cards charge $2 to $5 per month if you do not use the card for 90 days. Check your card's terms to see if this applies.
Before you buy, compare cards on their fee structure. A card with no monthly fee but a $3 ATM fee is better if you rarely withdraw cash. A card with a $10 monthly fee but free ATM withdrawals is better if you use ATMs often. The issuer's website always lists all fees upfront.
Prepaid cards versus debit cards and credit cards
Prepaid cards, debit cards, and credit cards all look the same and work the same at checkout, but they are different products.
A debit card is tied to your bank account. Money comes directly from your account when you swipe. You get fraud protection and your money is FDIC insured (protected up to $250,000 if the bank fails). Debit cards usually have no monthly fee. The downside: you need a bank account, and overdraft fees can be steep if you spend more than you have.
A credit card borrows money on your behalf. You pay it back later, and the card issuer reports your payment history to credit bureaus. This builds your credit score. The downside: you can overspend, interest charges are high if you carry a balance, and you need good credit to be approved.
A prepaid card is money you load in advance. You cannot overspend, there is no credit check, and no credit history is built. The downside: you pay more in fees, and you do not build credit. Prepaid cards are best if you want spending control, do not have a bank account, or want to keep money separate from your main account.
Who should use a prepaid card
Prepaid cards work well for specific situations. You might use one if you do not have a bank account and need a way to receive paychecks or make online purchases. You might use one to give a teenager a card with a set spending limit. You might use one to keep business expenses separate from personal spending. Or you might use one if you are rebuilding credit and want to avoid the temptation to overspend.
Prepaid cards are not a good long-term solution for everyday banking because the fees add up. If you use a prepaid card for a year with a $10 monthly maintenance fee and two $2 ATM fees per month, you pay $168 in fees alone. A free checking account costs nothing. But for short-term use or a specific purpose, prepaid cards solve a real problem.
What happens if your prepaid card is lost or stolen
If your card is lost or stolen, contact the issuer when ready using the number on your statement or in the app. Most issuers let you freeze the card right away through the app or website, which stops anyone from using it. Once frozen, the card cannot be used even if someone finds it.
Report the loss or theft to the issuer within 24 hours. Most prepaid cards offer fraud protection similar to credit cards — if someone uses your card without permission, you report it and the issuer investigates. You are usually not liable for fraudulent charges if you report them quickly. The issuer will cancel the old card and send you a replacement, usually within 5 to 10 business days. Your balance transfers to the new card automatically.
Frequently Asked Questions
Can I use a prepaid card to build credit?
No. Prepaid cards do not report to credit bureaus because they are not credit products — you are spending your own money, not borrowing. If you want to build credit, use a secured credit card instead, which requires a deposit but reports your payments to credit bureaus.
Do I need a Social Security number to get a prepaid card?
Most cards require a Social Security number or tax ID for set up. Some cards accept an ITIN (Individual Taxpayer Identification Number) instead if you do not have a Social Security number. Check the issuer's website or call before you buy to confirm what identification they accept.
Can I reload a prepaid card multiple times?
Yes. You can load money onto a prepaid card as many times as you want. Most cards let you reload through bank transfer, direct deposit, or retail cash loads. There is usually no limit to how many times you reload, though some cards cap the total balance you can hold (often $10,000 to $25,000).
What is the difference between a prepaid card and a gift card?
A gift card is usually single-use and only works at one store or brand. A prepaid card is reloadable and works anywhere that brand is accepted (Visa, Mastercard, or American Express locations worldwide). Prepaid cards also let you withdraw cash at ATMs, while gift cards do not.
Can I get a refund if I do not use all the money on my prepaid card?
The money stays on your card indefinitely — it does not expire. You can use it whenever you want. If you want to close the card and get the remaining balance, contact the issuer and request a refund. Most will send the balance back to your bank account within 5 to 10 business days, though some charge a small fee for this.