Payroll cards are a great way to make small payments if you don’t have a bank account. They’re also convenient because they can be used at ATMs and in stores. But there’s also a risk of hidden fees. In this article, we’ll cover the basics of payroll cards and how they compare to other payment options like credit cards or direct deposit. We’ll also cover some common fees associated with payroll cards and give you tips on how to keep those fees down.
Payroll card basics
Payroll cards are prepaid cards that can be used to make purchases or withdraw cash. They’re available for individuals who don’t have a bank account, so they’re perfect if you work in the gig economy and need access to cash on demand.
Payroll cards are reloadable and can be used to pay bills, such as utility bills, mortgage payments or rent checks (if you have a separate checking account). You won’t pay any fees when loading funds onto your payroll card—but if you do use it for other transactions like shopping online or making purchases at retailers with direct deposit capabilities (like Walmart), then there may be monthly maintenance fees associated with those types of transactions. So, acquaint yourself with what is a ghost card and how it can benefit you.
Fees are a major drawback of payroll cards. The fees can be avoided if you choose a prepaid card with no fees, but there are different types of fees that differ in how much you’ll pay them and what they will cost you.
- Balance inquiries: These are charged when your bank asks for information about the balance on your account (this is usually done to prevent fraud). If this happens while using a payroll card, it will cost $1 per inquiry or $3 per month if more than five payments were made that month. Cash reloads don’t count as balance inquiries because they’re not in aggregate—you’re only charged once per transaction when withdrawing cash from an ATM machine or writing checks out of your checking account (or both).
- Bill payments: These are charged whenever someone pays bills via mail through services like PayPal’s BillMeLater service or Venmo’s Pay Bills button feature; these services tend not only charge their own fee but also tack onto whatever service provider charges them so if there was no other option available then maybe paying through direct deposit would’ve been better.
Fees for balance inquiry
If you’re wondering whether it’s possible to use a payroll card for balance inquiry, the answer is yes. You can call the payroll card company and request that they check your balance. They’ll also tell you how much money is in your account at any given time, so that should help with any questions about how much cash is available on the card and what kind of transactions are supported by this particular type of account.
If you’d rather use an ATM instead of calling, then yes—you can do that too! Just remember not to spend more than $5 at an ATM unless otherwise specified by your employer (and even then). Also keep in mind that some banks will block their ATMs when they see questionable activity like this one happening; make sure that doesn’t happen before spending too much money!
Fees for ATM withdrawals
The fee structure for ATM withdrawals and balance inquiries is also quite simple. For each transaction, you’re charged $2.50 plus a percentage of the amount withdrawn. If you make a balance inquiry with your card, there is no fee associated with that activity either—but if you withdraw cash from an ATM or use it for bill payments (which requires verification), then those transactions will be subject to additional charges:
- Withdrawal at a bank account – 1% of the amount withdrawn
- Balance inquiry at an institution – 4% of the total value requested
Fees for a cash reload
If you use a payroll card to add money to your account, there are fees associated with this process. These fees can be waived if you have a direct deposit or bank transfer into the card, but they’ll still be charged if you use an ATM or pay with cash at an EFTPOS terminal.
For example: You want to add $100 onto your payroll card using just two withdrawals from your bank account (and no other methods). This will cost $2 in fees each time—$1 per withdrawal from an ATM and another $1 for using a debit card instead of EFTPOS machines.
Fees for bill payment
One of the reasons that payroll cards are often not a good choice is because they charge fees for bill payments. Some payroll cards charge an upfront fee to set up your bill payment, and some may even charge a monthly fee to continue using them. In addition, if you want to make changes in how much money goes out on your bills each month (for example, by increasing or decreasing how much goes out), some will charge additional fees for this as well.
Payroll cards are good if you don’t have a bank account, but there is a risk of hidden fees:
Payroll cards are not as safe as bank accounts. If you lose your card or it gets stolen and used fraudulently, you could be on the hook for those charges—and that’s not to mention what happens if one of these things happens while you’re traveling abroad (which is likely). In addition, some payroll card companies charge monthly maintenance fees that add up quickly if they’re charged every month (as they often are). And while this might not seem like much at first glance, over time these payments can add up to significant sums of money!
Payroll cards are a great way to save money and avoid fees that are often found in banks. The only thing you need is an internet connection and a card reader. Just make sure that the company you choose has good customer reviews, and make sure there aren’t any hidden fees when using their service.