Branded Prepaid Cards: Must-Haves for College Students

Network Branded Prepaid Card Association suggests branded prepaid cards as an affordable and accessible payment tool in a tighter credit environment

Surrounded by a climate of ongoing financial reform that has resulted in marked shifts in the banking and credit industries, this back-to-school season college students are seeking alternatives to traditional student checking accounts and credit cards. The Network Branded Prepaid Card Association (NBPCA) suggests prepaid cards as back-to-college essentials because of their ease of use for everyday purchases, low cost, built-in spending control and budgeting and savings features for on-the-go college students.

One of the new rules outlined by the CARD Act, which was signed by President Obama last year and took effect in February, states consumers under 21 cannot open a new credit card account without either a co-signer or proof of enough income to guarantee payment of the debt. This means that many college students no longer have access to credit cards. Additionally, under ongoing financial reform and economic recovery, many banks have increased the costs and minimum balance requirements for personal checking accounts. These developments have left many college students looking for affordable payments tools that will support their busy lifestyles.

Many students are turning to branded prepaid cards (with an American Express, Discover, MasterCard or Visa logo) as alternatives that meet their needs. The funds can be loaded by the student, by parents or even a grandparent or employer online, via direct deposit or at thousands of locations nationwide including banks, online, grocery and corner stores.

“Prepaid cards are must-have tools for college students today, allowing safe and convenient access to funds for everyday purchases, bill pay, budgeting and even savings features,” said Kirsten Trusko, President and Executive Director of the NBPCA. “College is a tough financial burden for many families and a branded prepaid card is an excellent way to affordably access the basic financial services a college student needs in a way that is secure and convenient for them and their parents.”

Added Tim Sloane, Director of Prepaid Advisory Service at the Mercator Advisory Group, the leading independent research and advisory firm focused on the payments and banking industries, “students could benefit from increased use of prepaid cards because it gives them a way to make purchases with the freedom of a credit or debit card without the risk of getting into massive debt or overdrawing accounts. They also can receive money electronically from relatives and other sources.”

The NBPCA offers a few tips that will ensure positive experiences for college students and their parents that choose a branded prepaid card:
• Shop around for the right card for you. You can find a branded prepaid card online, at banks or at major retailers and grocery chains. All cards come with different fee structures, features and benefits, so compare a few to get the card that fits your specific needs.
• Take advantage of the features. Branded prepaid cards come with features such as balance text alerts and some even have interest-bearing savings programs. Read about them and take advantage of all your card has to offer.
• Understand the terms and conditions. Read the information that comes with the card. Pay special attention to fees (if applicable) and when those fees are charged. Like any financial product, there can be fees attached to specific behavior (such as using an out of network ATM) and as with all cards, an expiration date.
• Record the card number and the customer service telephone number. Keep the information in a safe place.
• Familiarize yourself with the security and loss prevention features of your card. The value associated with the card can be recovered if the card is lost or stolen or if there are unauthorized purchases. If any of these occur, report it to the customer service number immediately.
• Keep track of your card balance. Most cards offer a phone, text or online option to do this. These cards help you avoid costly overdrafting, so when making a purchase that exceeds the card balance, be sure to tell the cashier that you plan to use two forms of payment: the prepaid card and the remaining amount however else you choose. Developing a disciplined approach to spending and staying aware of the card’s balance (through email, text alerts, etc.) will help keep you on track and mean fewer last-minute pleas to Mom and Dad.

About the NBPCA
The Network Branded Prepaid Card Association (NBPCA) is a non-profit, inter-industry trade association that supports the growth and success of network branded prepaid cards. The NBPCA brings together responsible members of the prepaid industry to provide a fact-based voice to media, government and consumers, developing recommended best practices and promoting education to help consumers optimize their experience with network branded prepaid cards. For additional information, visit, or consumers are encouraged to visit the NBPCA Facebook for education about branded prepaid cards.