What are Cash Cards: A Comprehensive Overview
Are you looking for new forms of payment?
Paying your bills on time is difficult, especially if you follow a busy and packed schedule. If you fail to pay on time, you could fall behind payments and go into debt. With new advances in technology, though, there are new ways of paying bills without any hassle.
One of these new forms of paying your bills is cash cards. There are 253 million adults in the U.S who have one. What are cash cards, though, and why do a lot of people prefer using them?
Read what’s below to understand what they are and what they do. Realize what makes them the better choice when paying for your transactions and how they can benefit you today!
What Are Cash Cards and How Do They Work
What are cash cards? A cash card is an electronic form of payment that stores your money. They can have different forms, such as bank or prepaid debit cards, gift cards, and payrolls. Credit cards are not included due to their function of accumulating debt rather than paying what you owe upfront.
Cash cards provide an easier way of payments through electronic means. This makes them more convenient as you’ll only need to scan your card against an interface to register your payment. You can even use them right from your mobile device.
In some cases, you can send your payments through direct bank transfers using these cards. It allows you to use and keep an eye on the resources that are safely stored in your bank. This way, the bank can also keep a record of your transactions for future reviews.
Cash Payments vs Cash Cards
Even in these modern times, physical cash will always have its place in the economy. You can use them anywhere and you’ll find they’re still acceptable forms of payment, such as in small businesses that don’t accept cash cards. This is where cash cards fall short as some establishments don’t have the means to process electronic transactions.
Cash payment can also make you some deals with a few retailers. Some retailers offer discounts to customers who pay with cash.
Carrying cash on your person can be risky, though, as you can misplace it or in some cases, lose it to a thief. You can also fall short on your payments if you rely on the cash you have on hand. Even though there are many ATM’s around, they aren’t always nearby when you need one.
Cash Card Advantages
As useful as paying in cash may be, cash cards have many more advantages than it. You can use cash cards almost everywhere, especially now that most establishments are looking to forego the use of cash during the pandemic.
You also don’t need to worry about running out of cash on hand when using cash cards. You’ll pull directly from your resources, ensuring that you have enough to pay for items that are within your budget. You only need to keep an eye on how much you spend to avoid depleting your reserves.
Cash cards come out on top when it comes to safety and security. They hold an EMV chip that protects you against fraud and stolen transactions. Issuers will offer fraud liability services to protect against any unauthorized transactions.
Cash cards are easier to abuse, though. Overuse of cash cards can cause you to incur some interest that can become debt. It needs you to have self-discipline if you don’t want to see a near-empty bank account.
Another downside of using cash cards is that you need to pay an annual fee. Some cash cards, especially those that use reward points, charge an annual fee.
Some cards offer no annual fees, but they’re harder to find and subscribe to. The prerequisites or these are often the same, though. You’ll need a good credit score and credit history to avail of these cards
Different Kinds of Cash Cards
As mentioned before, there are four main types of cash cards that you can apply for. They serve different purposes, and you use them as you see fit for your needs and goals.
A bank or prepaid debit card is a card from your bank or credit union. They give it to you once you have opened an account there. It’s free to use, but sometimes you will need to pay a fee to use it.
They look like credit cards but don’t work the same way. As mentioned above, it won’t cause you to incur debt to pay off at the end of the term. You can better manage your resources this way.
Gift cards are a prepaid debit card that has a specified amount of money for a product. You can use these to pay for the products of a specific retailer without fear of mismanaging your resources.
Payroll card that’s funded by your employer. They’re like direct deposits that the workers can use anywhere for electronic payment. Payroll cards are also reloadable, so a worker doesn’t need a new one every day.
Cash Advance Fees
Before getting a cash card, you need some essential information about it. It’s what our cash advance fees on credit cards.
Cash advances are a way to get cash fast but will come with a hefty price. The issuer will charge you an advance fee that’s 3% or 5% higher than the amount you requested. Once you use an ATM or visit your bank, you can expect to see the amount deducted.
Cash Back Rewards
What are cash back rewards on credit cards? These are rewards you get for spending a total amount of money on an item.
You earn cash credit whenever you buy an item from different brands. Some cards will even offer bonus cash back on special categories each quarter. The rewards you get will depend on your card issuer, so it’s best to look into them before signing up for a card.
Know What Are Cash Cards and Use Them Today!
What are cash cards if not a budgeting tool that provides many useful features? They’ll help you manage your resources and allow you to pay fees in almost every retail store with ease. Sign up for one and use them to shop today!
Do you want to learn more about financial management through cash cards? Check out more of our guides to learn all you can today!