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Questions to Ask About Paycards

05/15/2019 | By: Brinks Money

Questions Every Employee Should Ask About Payroll Cards

Payroll cards are great for employers seeking to simplify their payroll systems. As an employee, a paycard allows you to get paid quickly, compared to being paid via paper checks, and access your paycheck funds using a card similar to a debit card. The money goes into a secure account, and you can use the card to make purchases in stores or online, and withdraw cash in a variety of ways.

If your employer offers a payroll card option, it benefits you to get informed about that option by asking your employer a few questions:

How can I use my paycard?

Who is the card issuer, and which businesses accept their cards? Many payroll cards are issued by well-known providers, e.g. Mastercard, meaning you can use them wherever the issuer’s cards are accepted. Make everyday purchases like gas and groceries, pay bills, and shop online.

You’ll also want to ask about cash withdrawal options. The best pay cards make retrieving your funds easy and convenient, with thousands of withdrawal locations nationwide.

How will money be loaded onto my card?

Ideally, your paycheck will be loaded directly and automatically into your payroll card account every pay period.

Are there any fees?

If there are any fees associated with your paycard, employers will sometimes foot the bill. Ask your employer whether you are responsible for any:

  • Monthly fees
  • Transaction fees
  • Cash withdrawal fees
  • Point-of-sale fees
  • Card replacement fees

Is the payroll card issuer financially solvent?

A financially secure paycard company means you can feel secure using your card to make purchases and withdraw funds. Be sure to ask your employer if they have vetted the card issuer’s financial state.

How are my card’s funds protected?

Paycard funds are transferred electronically, and the Federal Electronic Fund Transfer Act protects electronic fund transfers by setting limits on the amount of money you lose if a card is stolen. Make sure the money in your pay card account is FDIC insured by checking with the pay card issuer.

Is my privacy protected?

How does the card issuer use your transaction data? How is that data stored and secured against identity thieves? If the card issuer is a major bank, you thankfully shouldn’t have many concerns about security or privacy. Even so, it’s best to be informed.

How will the card affect my credit?

Because a paycard is a prepaid card, it doesn’t affect your credit. That means you won’t lower your score with a payroll card, but you won’t build credit either.

A payroll card, however, could be a good alternative for you to manage your funds more effectively and avoid incurring additional debt. A few programs offer budgeting tools, to help you plan purchases for the months and keep track of your spending habits. That said, you can stay out of trouble by simply monitoring your account activity and making sure you don’t overspend for any particular item in your budget.

Does the paycard come with rewards or other benefits?

Sometimes payroll cards offer rewards for use. For example, a card may come with cash back rewards on everyday purchases at retailers and restaurants. These rewards encourage you to use the card (versus withdrawing your full paycheck) and can add up to major benefits over time.

Payroll cards can be beneficial for both employees and employers, offering convenience and cost savings. Feel free to contact Brink’s Money if you’re looking for paycard options or want to learn more about payroll and expense options.