Payroll Card : Whats It All About

By: EconomyWatch Content Team   Date: 2 February 2010

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There are a lot of questions that most people have concerning payroll cards since they are not as well known as a debit card, though they work very similarly. A payroll card is a card that allows you debit card like access to your paycheck. The money is held in an account for you can you can withdraw it an am ATM or use the card to spend it like a normal debit card. It is not the same as having your own bank account since the account is usually in the name of your employer but it is much cheaper than a check cashing facility.

The first thing to ask is if the company that issues the payroll card is financially stable. Some of the companies that issue the card are banks, and these generally tend to be very stable and secure places to entrust your paycheck to. But if the issuer is not a bank, ask your employer what they know about the financial stability of the company, if they do not know this information ask them to look into it before you request to get the card.

It is also important to ask about any fees that are associated with the payroll card. There are a number of fees that may be charged to your account including monthly fees, ATM fees, inactivity fees, and fees to get your money back if you decide to cancel the card. Now, not every card issuer will charge these fees, but it is important for you to know what fees may be charged to your card before you make a decision about getting one. Often payroll cards will have more fees associated with them than other kinds of cards, but some employers can help you eliminate some of them and a few may even pay the fees for you.

If you like the convenience of setting up regular automatic payments to pay all of your bills, ask your employer if that is possible with their payroll cards. Some cards do offer this feature so that it is more convenient to pay your monthly bills, but others do not. It is also important to know if it’s possible to overdraw the card. Some of them are set up more like a prepaid debit card and you can only use it for as much money as you have in the account, but other will allow an overdrafted transaction to be processed and simple charge you a fee for that.

Finally, you need to know about your financial privacy. Since the account is not in your name, you need to know if your personal information is protected or if the issuing company will have access to it for marketing purposes


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