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Direct Deposit and Payroll Cards

While people with bank accounts may able to sign up for direct deposit, employees without bank accounts who have jobs that only offer direct deposit may have to get their wages on a payroll card.  These cards are also called pre-paid debit cards.  While payroll cards do offer some conveniences, they are relatively new products. They often come with many fees that most consumers are not aware of until they are charged.

The information below summarizes the fees commonly charged by payroll cards.

Accessing Your Money: Many prepaid cards are not associated with ATM networks so accessing your money can be pricey.  Even if your cards are associated with an ATM network, they sometimes charge a fee.

Checking Your Balance: Many customers are charged a convenience fee for checking their prepaid card balance either at an ATM or by requesting paper account statements.

Activation Fee: Prepaid cards may charge an activation fee of up to $10.  One way to avoid this fee may be to purchase the card online.

Monthly Maintenance Fee: Many cards charge a monthly maintenance fee whether you use the card or not.  Sometimes this can be avoided by setting up direct deposit on the card.

Overdraft Protection: Some prepaid cards will make a "courtesy payment" if you happen to overdraft your account.  Fees can pile up with courtesy payments. Then, when another deposit is made and the card then deducts these charges plus penalty fees.

Point of Sale Purchases: Some prepaid cards will charge you a small fee if you choose the PIN option rather than a signature when making a purchase.

Inactivity Fees: Some cards will charge you a fee if you do not use them for a specific period of time.

Customer Service: Some prepaid cards will deduct a fee from your account if you call its Customer Service line.