Rush Card | Pros and cons of prepaid cards
Rush Card is one of the many pre-paid credit card options available. The Rushcard service, like most prepaid cards, has features that can make it very useful, especially for people who cannot get or do not want a regular credit card. However, before you make a decision about getting a Rush Card, it is important to understand both the benefits and high costs of the system.
How Rush Card works
While Rush card markets itself as a “pre-paid credit card,” it works more like any other debit card. A customer can load the card with money, and then use it anywhere a Visa card is accepted. Money is debited from your Rushcard account, and when the balance reaches zero, any other transactions are declined. Some Rush card accounts also allow cardholders to write checks against the account balance. Rushcard charges fees for the use of the Rush card. Rush Card was created in 2003 by Russell Simmons, under the business name UniRush.
Benefits of Rush Card
The Rush Card does provide some benefits to cardholders. A credit card can be very difficult to get for individuals with bad credit. Because Rush Card works on the Visa system and has a full credit card number, it can be used to make online purchases and where a credit card would normally be used. The pre-paid system also means that it is impossible to overdraw your Rush Card account – no overdraft fees and no high interest rate credit.
High costs of the Rush Card
The Rush Card, however, does not work like a standard checking or debit account. Depending on which of the two types of Rush Card a customer gets, the fees can be very high. Activation and monthly fees can run as high as $19.95. There are fees for ATM balance inquiries and withdrawals. There are statement and “maintenance fees.” There is a fee for paying bills with the Rush Card. The highest cost fee, however, can be the “convenience fee.” This convenience fee charges between 50 cents and $1 each time your Rush Card is swiped or used to make a purchase. Long story short, the Rush Card could cost you $100 a month or more — to access your own money.
Alternatives to the Rush Card
The Rush Card does offer some convenience in accessing and using money. However, fees for standard transactions make it incredibly expensive. If you have bad credit or no credit, a checking account is most likely a better solution than the Rush Card. Many credit unions offer “starter” bank accounts designed especially for customers who would have difficulty getting a checking account at a bank. These starter accounts usually do not carry nearly the fees that the Rush Card does, and a debit card offers the same benefits as the Rush card. Even if you have had financial problems in the past, check with multiple banks or credit unions to see if they can offer help – before you sign up for the high fees of the Rushcard.