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IDT Prime prepaid debit card - Scandalous!
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Amanda
Posts: 120 Forumite
Official MoneySavingExpert.com insert
For full info on the best prepaid credit cards available at any time, see the main website's Prepaid Credit Cards guide.
Back to the original post...
I know this isn't a credit card but this seemed the most appropriate forum for this post.
My local convenience shop sells these cards over the counter. The idea being a debit card with no credit checks and no possibility of going into debt. You load money onto the card and use it to withdraw cash from Atms and make purchases anywhere a normal debit card would be accepted.
I can see that it would appeal to those on low incomes and benefits who are unable to get a current account with a debit card.
However, I am amazed at the charging structure for obtaining and using these cards. Firstly, the card costs £3 plus £1.95 to make it 'Top-uppable' or reloadable as they call it which sounds reasonable, but then you get charged not only for each purchase, but for each top-up!
You get charged 2% of the amount you top-up the card with (min 80p)!
You get charged 75p or £1.50 for using UK and foreign atms respectively! This means that if you use a chargeable UK Atm, say £1.50 for withdrawals, you will pay £2.25 for getting your own money!
Transactions charged at 2% of amount of transaction (min 50p max £1)
If you don't use the card for 3 months, they start charging a so-called maintenance fee of £2.95 per Month! You can tell that this is designed to empty accounts where the card has been lost or forgotten about - Clever eh!
So you get a card which costs you every time you top it up, every time you use it and charges you for every ATM withdrawal whether you use a free ATM or not!
It even charges you for not using it!
These transaction fees may seem small on the face of it but used over a year would likely result in many hundreds of pounds in charges and fees.
The only thing that I think it may be good for is for purchases over the internet where you can keep a modest balance to pay for such purchases.
For full info on the best prepaid credit cards available at any time, see the main website's Prepaid Credit Cards guide.
Back to the original post...
I know this isn't a credit card but this seemed the most appropriate forum for this post.
My local convenience shop sells these cards over the counter. The idea being a debit card with no credit checks and no possibility of going into debt. You load money onto the card and use it to withdraw cash from Atms and make purchases anywhere a normal debit card would be accepted.
I can see that it would appeal to those on low incomes and benefits who are unable to get a current account with a debit card.
However, I am amazed at the charging structure for obtaining and using these cards. Firstly, the card costs £3 plus £1.95 to make it 'Top-uppable' or reloadable as they call it which sounds reasonable, but then you get charged not only for each purchase, but for each top-up!
You get charged 2% of the amount you top-up the card with (min 80p)!
You get charged 75p or £1.50 for using UK and foreign atms respectively! This means that if you use a chargeable UK Atm, say £1.50 for withdrawals, you will pay £2.25 for getting your own money!
Transactions charged at 2% of amount of transaction (min 50p max £1)
If you don't use the card for 3 months, they start charging a so-called maintenance fee of £2.95 per Month! You can tell that this is designed to empty accounts where the card has been lost or forgotten about - Clever eh!
So you get a card which costs you every time you top it up, every time you use it and charges you for every ATM withdrawal whether you use a free ATM or not!
It even charges you for not using it!
These transaction fees may seem small on the face of it but used over a year would likely result in many hundreds of pounds in charges and fees.
The only thing that I think it may be good for is for purchases over the internet where you can keep a modest balance to pay for such purchases.
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Comments
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Unfortunately people on low incomes and benefits with poor credit history are the ones forgotten about by most companies. The companies that do offer services for them are vastly overpriced like Brighthouse or the Pre Pay card you just said about.
I saw an advert today for payday advances....... The APR overall was 547.3%:eek:
Of course if you dont have access to emergency savings or credit cards/overdrafts like most of these people dont then you have to take the 547.3% or starve!
Whatever peoples problems, you'll always find some chap who is doing realy well off the back of it..... This is that case in point.0 -
Why would anyone draw cash on one of these cards?
I can understand them loading money and shopping online, but loading cash and then withdrawing it doesn't make any sense to me... ?0 -
Iv no idea why you would. If I see someone doing it il ask lol!0
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Not quite the same but my daughter is at university and I gave her an egg money card that I pre pay for her for shopping and the odd cash withdrawal. (my card though as I don't think she would meet the criteria :-/)0
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Similar to prepaid mobile phones, the prepaid card industry charges usage fees. All prepaid card providers charge similar fees, in fact the Prime Card is one of the most competitively priced.
Consumers who use credit and debit cards are regularly charged high interest and over draft penalties. Card holders who experience minor issues can see a mountain of debts pile-up, as banks charge £20 or more to send a letter and charge large amounts for missing direct debits.
Prepaid card holders are able to control their spending with a “pay-as-you-go” fee structure. The Prime Card is clear and transparent about fees and charges. These are displayed in the card pack and on the website. They are also referenced on the card packaging and Point of Sale material.
It is important to note that these cards are aimed at consumers who, for one reason or another, are unable to get a credit or debit card. Prepaid cards give them the opportunity to benefit from the cheaper prices available when purchasing online. They also empower individuals by giving everyone the benefits of plastic, without the exposure to debt.
If you would like to know more about the Prime Card please visit: http://www.idtprime.com
Jamie King
Director, IDT Finance0 -
Prime_Card_Spokesperson wrote: »Similar to prepaid mobile phones, the prepaid card industry charges usage fees. All prepaid card providers charge similar fees, in fact the Prime Card is one of the most competitively priced.
Consumers who use credit and debit cards are regularly charged high interest and over draft penalties. Card holders who experience minor issues can see a mountain of debts pile-up, as banks charge £20 or more to send a letter and charge large amounts for missing direct debits.
Prepaid card holders are able to control their spending with a “pay-as-you-go” fee structure. The Prime Card is clear and transparent about fees and charges. These are displayed in the card pack and on the website. They are also referenced on the card packaging and Point of Sale material.
It is important to note that these cards are aimed at consumers who, for one reason or another, are unable to get a credit or debit card. Prepaid cards give them the opportunity to benefit from the cheaper prices available when purchasing online. They also empower individuals by giving everyone the benefits of plastic, without the exposure to debt.
If you would like to know more about the Prime Card please visit: http://www.idtprime.com
Jamie King
Director, IDT Finance
you cant deny it m8 - its still a rip off compared to the other cards out there0 -
For very short term loans (e.g. a couple of weeks), APR is a nonsense figure, you should look at the percentage you're paying on top of the original loan rather than looking at APR numbers, e.g. if you *really* need to borrow £100, then repaying £110 after 2 weeks might seem reasonable to you in order to escape a problem.0
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It amuses me when people like Jamie King, Director of IDT finance write as if they are giving the low income earners some fantastic, almost charitable access to financial services.
Companies like IDT charge the lowest earners the highest interest rates. Its their way!
Now they have come up with Mickey Mouse debit cards which charge you for buying them, pays NO interest on your account balance, charges you every time you use them, charges you every time you top them up and even charges a monthly non usage charge if you don't use them! Damned if you do, damned if you dont!
So the low income person using the cards gives millions of pounds collectively to IDT for no return, and instead of IDT saying thank you here's your interest, they actually say, 'Give us your money so we can invest it and pay us for taking it from you!"
I'm not a financial expert but that is a lose-lose situation for the schmucks who buy such a card! It is scandalous!
Inevitably the charges and percentages will go up once the user base is established. Then there will be a lot of people who have discovered just how expensive these cards are to use. They will then stop using them. The resulting balances in these dormant accounts will be sucked dry by the monthly non-usage charges.
It is a win-win situation for companies like IDT. It is financial madness for anybody getting these cards.
Mickey Mouse debit cards where YOU pay to spend YOUR OWN money! It's just plain silly!0 -
Hello, this is my first post and I have some questions about the Mastercard Prime:
I will primarily use it (if I get it) for purchases over the net of not much more than £40 (games/DVDs mainly), so am I right in saying that, even taking the reload fee (2% of what you load) and the transaction fee (50p - £1), I would still be saving tons over what I'd pay in store? I have found that games, for example, have a saving of around £5-£10 and often more over what you'd have to pay in store, if you get them from somewhere like play.com. The £2.95 dormancy fee doesn't bother me, as I easily buy at least one item a month, such as a game or a DVD and I'm very good at monitoring my finances, so I don't think it'll ever even come into play. So since I'm making savings of around £5 or £10 or more if I buy online, wouldn't it be worth my while getting a Mastercard Prime, since having to pay these small reload and transaction fees is not going to come anywhere near being equal to what I'd save on the price of the item itself.
In case you're wondering why I don't just go for a proper credit card, it's not because I'm rubbish with my money, I just don't trust online shopping enough to have my main financial details floating around the net! This way, if anything goes wrong, all I lose is what's on the card and that's not going to be more than £40 or so. What I'd probably do is top the card up and then make the purchase as soon as the balance is updated, so it wouldn't be a case of £100 or so sitting on the card for ages.
Please reply, as I have asked other forums and no one has bothered to reply. In fact, most of my posts on the matter seem to be deleted!!
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The only thing that I think it may be good for is for purchases over the internet where you can keep a modest balance to pay for such purchases.
Exactly what I'd be using it for! Thanks for that.
Edit: I've just noticed that this thread is a few months old @a moderator, should I open a new thread for my question? I'll wait a day or so, if no one answers, I'll open a new thread.0
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