Green Dot, finest identified for its pay as you go debit playing cards, has now launched a secured bank card, the Green Dot Platinum Visa. How does a secured card differ from Green Dot’s debit playing cards? And the way does Green Dot’s secured bank card stack up in opposition to different secured playing cards? Our overview / overview of the Green Dot Secured Platinum Visa is under:
Let’s start by speaking about what a secured bank card is. Secured bank cards work identical to another bank card apart from one vital distinction: it’s essential to put down a safety deposit to get the cardboard. That safety deposit is refundable once you now not need the cardboard, however you do NOT pay your payments from that cash, that is NOT a debit card.
The safety deposit is collateral, safety for the financial institution should you don’t pay a invoice sooner or later. (For those who’ve ever rented an house, the safety deposit you set down on an house is just like the deposit you set down on a secured bank card — it’s there to guard the lender in case you don’t pay.)
The purpose of a secured bank card is that will help you construct credit score historical past. (Or rebuild your credit score historical past in case you have low credit score.) Whenever you pay your card payments on time, your credit score rating will increase, which might help you get higher charges on bank cards and different loans sooner or later. Pay as you go debit playing cards, however, do NOT enable you to construct credit score. (For those who’re nonetheless confused in regards to the distinction between a secured card and a pay as you go debit card, go here for further explanation.)
That stated, the Green Dot Secured Visa lets you put down a safety deposit wherever from $200 to $1000. You’ll be able to then make purchases with the Visa as much as the quantity of your safety deposit, and then you definately repay these purchases every month. (Keep in mind that your safety deposit shouldn’t be touched; it’s essential to make a month-to-month cost like another bank card.)
The Green Dot Secured Visa has an rate of interest of 19.99%, which is excessive, so that you wish to you’ll want to repay your full steadiness every month. The cardboard additionally has an annual price of $39. This price shouldn’t be related to the safety deposit, which means you gained’t get it again.
Total, the Green Dot Secured Visa’s phrases are in keeping with many different secured playing cards in the marketplace. Nonetheless, it fails in a single vital space: there may be not a direct path from this secured card to an unsecured card sooner or later. A number of different banks that supply secured bank cards promise to contemplate you for the standard bank card after a 12 months or so in case you have made your whole funds on time. Green Dot doesn’t have an unsecured bank card in any respect. Subsequently, we will’t advocate the Green Dot secured card over these. We’d recommend you instead look at our secured credit cards page and select one of many prime listed playing cards that do provide the potential of an improve.