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If you’ve heard that Netspend allows you to overdraft your account, that statement is true.
Netspend does allow you to overdraft on your account but only if you’ve previously enrolled in Netspend’s overdraft protection service.If you haven’t signed up to it, Netspend will not allow you to go over your authorized amount on your card.
Netspend cards are actually prepaid debit cards.They give the cardholder the opportunity to make purchases anywhere in the world.
In order to get a Netspend debit card, you have to deposit money on the card.Once you have, you’ll be able to use it anywhere it’s accepted.
How Does Netspend’s Overdraft Protection Service Work?
Netspend offers their customers a free purchase cushion or overdraft buffer of $10.This means that you would not incur typical overdraft charges of $15 if you go over the amount on your debit card.
While the protection gives you a little wiggle room, it’s not a permanent free pass.You will have a grace period of 24 hours to repay the negative balance.
If you don’t, you’ll be charged $15 per each occurrence.However, that amount is limited to a maximum of 3 fees per calendar month.
Now, that doesn’t mean that Netspend will authorize every overdraft.Netspend’s terms and conditions indicate that the company only pays overdrafts at its own discretion and does not guarantee payment of every overdraft transaction.
Unauthorized overdraft transactions are declined and Netspend may charge fees for these declined transactions.
How To Enroll In Netspend’s Overdraft Protection Service
There’s a few different ways that you can enroll in Netspend’s overdraft protection service.One, you can do it by accessing your online account.
If you don’t have an online account, you’ll need to create one prior to activating the protection.Two, you can call Netspend directly and they can help you activate your overdraft protection.
It’s important to note that they do have some eligibility requirements you’ll need to make before you’re approved.The first requirement you’ll have to meet is signing up for direct deposit.
In addition to that, you’ll need to at least receive $400 in your account within a 35 day period to be eligible.To complete this requirement, you’ll need to read Netspend’s terms and conditions, agreeing to them electronically.
Secondly, you’re going to need a valid email address so Netspend can notify you of program changes.If you can complete all of these steps, Netspend will activate your overdraft protection.
This usually only takes around 24-30 hours.
How Do Netspend Debit Cards Work?
Netspend was founded in 1999, so they’ve been around for 20 years.Essentially, Netspend provides reloadable prepaid cards:
Just in case you’re wondering, Netspend does not check your credit.If you have bad credit or no credit, you’ll still be able to get approved for a prepaid card.
With that said, you will be required to verify your identity.A driver’s license or photo ID would work.
One thing that a lot of Netspend customers enjoy about the company is the fact that they do not have activation fees.They also don’t require you to carry a specific balance on your debit card.
Because it’s not a credit card, there’s no interest to be charged.
In total, Netspend has 3 plans you can choose from.Two of those charge monthly fees, so be aware of that.
The other plan from Netspend is the premier plan, this one doesn’t have monthly account fees and allows unlimited purchases.However, for this plan, you would be required to carry a certain balance.
How Can You Add Funds To Your Account?
If you want to add funds to your Netspend debit card, there is a few ways to make that happen.Here’s the options you have;
Netspend Card Transfer
Netspend card accounts are insured by the Federal Deposit Insurance Corporation (FDIC) up to the current coverage limit and the cards can be used at any site or locale that accepts MasterCard and Visa debit cards for transactions, including ATMs.
Do You Use Netspend Because You Have Bad Credit
A lot of men and women choose to use Netspend because they have bad credit.While there’s nothing wrong with that, we wanted to take this time to provide you with more information to help you build your credit back up.
Remember, Netspend is a prepaid card, it does not report to any credit bureau.Why is that important?
It’s important because if it did, it would count toward your credit history.If you use a card responsibly, it helps your credit.
If you do have bad credit and you’ve been turned down for new credit, you still have a few options to begin building your credit.What you need is called a secured credit card.
Secured credit cards are obtained by making a deposit to a credit card issuer.In return, they will provide you with a credit line for the amount of the initial deposit.
For example, if you deposit $500, you would have a credit card with a $500 line.
Before you apply for any secured credit cards, you do want to make sure they report to at least one of the major 3 credit bureaus.Some secured cards will report to one credit bureau while others report to all 3.
As long as they do, you’ll earn credit and it will count toward your credit scores.
Most of all the major credit card companies have a secured credit card.Capital One, Bank of America and Citi Bank all have secured credit cards.
All you need to do is contact them via the phone and ask them about their secured credit card options.You can also apply online for a secured credit card.
While Netspend cards are helpful, they do not help your credit.
Credit Shout is a community of personal finance experts dedicated to helping you save money and make smart financial decisions. Learn how to master your credit card rewards, improve your credit score and start eliminating your debt.