• You take a trip out of state, say driving across the border and fill up your car at a gas station. The card company has no record of you being in that area, and so it flags this as unusual behavior. Perhaps a thief has your card?
• You make a small online purchase. For example, to set up a child e-mail account, Yahoo requires the parent to charge their credit card by fifty cents. My account was frozen when I did this recently, and I had to call the fraud hotline to verify that the charge was legitimate.
• You travel to a foreign country without telling your credit card company in advance.
• You make a series of purchases for things you do not usually by. For instance, you’ve never bought woman’s lingerie. Until your credit card company intuits this new pattern (maybe you recently got engaged) this may put a freeze on your account.

A Frozen Credit Card

For debit cards, the issue is the hold that happens whenever you pay for something with a signature purchase in which the vendor does not know in advance exactly how much your purchase will be, but you can access the service or product in advance of payment. The two most common situations are renting a hotel room or gasing up your car. For gas purchases at the pump, typically a hold of $50 or as much as $75 is immediately put through, meaning you need to have that much money in your card account to avoid having the purchase being denied at the point of purchase. If you logged into your card account after making a $20 gas purchase, for example, you would see the charge as $75 perhaps for a few hours or maybe even a day or two before the actual amount was registered and the difference credited back to your account. For hotels, the “hold” would be much higher to cover a night’s room rate, say $150 or $200.

Susan Stellin writing in the New York Times spoke to a credit card company about the freeze she experienced when buying gas out of state:  

I was surprised that a cheap gas purchase in California could also freeze my account, so I called U.S. Bank to find out if travelers need to start alerting their banks about their domestic travels, which seemed like overkill to me.

It probably is, said Dave Leiker, a senior vice president with U.S. Bank. He told me that besides watching for unusual spending patterns, banks also monitor where criminals use stolen cards, places like automated payment kiosks in metropolitan areas.

“We may have been seeing a trend where the bad guys were out there using stolen credit cards at gas pumps,” he said.

Freezes and Holds on Credit Cards and Debit Cards is a post from: MiCash Prepaid MasterCard

In college I was handed a box of personal grooming freebies that included Mennen Speed Stick deodorant, a Trac II razor, and Edge shaving cream. Guess what? I still use all three brands. I finally switched to the five blade razor models just this year when I forgot my razor on a business trip. Still, I agonized in the aisle of CVS studying the razors until I finally took the plunge.

Why do people stick with their bank for so long? Here are the top five reasons people stick with a brand according to another study in the UK by a marketing firm.

1. Consistently high quality products
2. Helpful, knowledgeable staff
3. Easy to contact the company
4. Every aspect of the brand experience is enjoyable
5. Customers are recognized and valued when they call customer support

So, credit card and prepaid debit card companies should pay attention to what their customers want, and they can extend loyalty years out. Perhaps couples could learn from banks and work on being “helpful” and “easy to talk to.”

Study Shows Bank Loyalty Higher than Marriage Length is a post from: MiCash Prepaid MasterCard

Looking for a prepaid debit card at Rite Aid? Or are you wondering if your local Rite Aid has Greendot MoneyPaks for reloading your prepaid card. The answer is yes on both counts. Continuing our series on where to find MoneyPaks to reload your MiCash Prepaid MasterCard, here are some facts about this drug store chain.

• Rite Aid Corp. is the third largest pharmacy chains in America with nearly 4,800 stores in 31 states.
• You are more likely to find a Rite Aid on the East or West coast. In fact Rite Aid is the largest drugstore chain on the East Coast
• Find the company on the New York Stock Exchange under the stock ticker RAD.
• Rite Aid’s first store opened in September 1962 as Thrif D Discount Center in Scranton, Pennsylvania.

Greendot MoneyPaks at Rite Aid

So, when you come through the big glass doors at your local Rite Aid, make a beeline for prepaid card kiosk. There you will find Money Paks hanging in their bright green packages. For just $4.95 you can put a bunch of cash on a MoneyPak, then call Greendot’s customer service phone number or go online to move that money onto a prepaid card. Why not use the MoneyPak for making purchases? Well, other than eBay and a few other places, merchants don’t accept MoneyPaks. They are not branded Visa or MasterCard to function on those debit card network. However, it is swift and easy to use a Greendot MoneyPak as a means to get your cash onto your prepaid card.

Rite Aid and Greendot MoneyPaks is a post from: MiCash Prepaid MasterCard

How can thieves install this device? First they mustbe able to open up a locked panel of the gas pump.  They can do this with a stolen or duplicated master key for the pumps, used by service technicians. They then have to be able to install the device quickly and exit the scene without getting caught on security cameras. They don’t have to go back to the skimmer to get the numbers but can retrieve them with a simple bluetooth wireless transmission from a hidden nearby spot.

For other devices, such as a movie rental kiosk or touch pad card reader, they simply add a skimmer device that blends in physically with the look of the card reader. This can also be done on ATM machines where thieves install a small camera to also record your PIN number via wireless video as you key it in.

Illegal card skimmer attached to blend in.

Red Box DVD rental kiosks have been known to be modified with skimmer devices that are the same black color as the legitimate card reader. According to Brian Krebs, a security expert who tracks these cases,

Customers who suspect their local Redbox may have been tampered with should contact 630-756-8866, e-mail alerts At redbox.com or notify the manager of the store or restaurant that houses the machine.

Card reader devices are continually being modified to stay one step ahead of this thieving technology, but small merchants in particular aren’t always able to update their gas pumps or PIN pad machines on a regular basis.

Thieves Turn to Skimmers to Steal Credit and Debit card Numbers is a post from: MiCash Prepaid MasterCard

If you are looking for a fast and easy way to load money on your MiCash debit MasterCard using Greendot MoneyPaks look no farther than your local CVS pharmacy. There are more than 7,000 CVS locations nationwide. This makes it the largest pharmacy chain in the country. CVS Facts:

• Headquarters located in Woonsocket, R.I.
• More than $87 billion in annual revenue
• Largest employer of Pharmacists and Nurse Practitioners
• No. 1 in Store Count – more than 7,000 CVS/pharmacy stores in 43 states (includes Longs Drugs in Hawaii)
• 4+ million customers per day

All you have to do is walk into the store and find the gift card and prepaid card rack on an end-cap of one of the aisles near the check out register. You can’t miss it. Look for the Greendot package which not surprisingly is green! Take the Moneypak to the register, hand the cashier your cash, and minus the cost of the Moneypak (i.e., you will have converted your cash to the MoneyPak. Now, you can’t use a MoneyPak for direct purchases of products. Rather it is just a convenient way to transfer money to a prepaid card. So the next step is to call the Greendot customer service number printed on the MoneyPak and over the phone provide the unique Greendot identifier number and your prepaid card account number. This 16-digit number is embossed on the front of your prepaid card.  Greendot will be able to see how much money you just put on your card, and transfer the entire balance to your prepaid card. After you have depleted the one-time-use MoneyPak, you can toss it in the nearest trash can. It has served its purpose.

Greendot MoneyPaks at CVS is a post from: MiCash Prepaid MasterCard

In Mintel’s recent survey, 19% of respondents overall stated that they would be interested in using prepaid cards to pay bills, rather than a banking account. More importantly, 25% of households earning more than $100K per year, the more profitable and desirable customers for banks, agreed that they would be interested in using prepaid cards. Their main motivation was to avoid overdraft and/or other types of banking fees.

What are these prepaid card prospective customers looking for? Mintel’s research show:

What are the most popular ways for prepaid providers to offer incentives to attract this new class of customer? According to Mintel, approximately six in 10 people say they would be interested if a rebate or cashback were offered for using the prepaid card and seven in 10 find purchase discounts at merchants to be an attractive offer.

Fact is, with the new consumer protection laws put in place by congress, banks can no longer allow transactions for debit card holders create an overdraft. However, if a cardholder opts in for “overdraft protection” then they can put through overdrafts and potentially charge the customer a fee–either for the overdraft protection or for any overdrafts themselves. This is why you may have received ominous sounding emails or direct mail from your bank warning you that “you are no longer protected.”

Prepaid cash back rewards programs do exist. In fact MiCash is about to announce our own cash back rewards program very soon. Such programs let you shop at your favorite national or local retailers and restaurants, and redeem actual cash back that is credited to your prepaid card account.

Prepaid Card Use on the Rise as Consumer Dissatifaction with Banks Grows is a post from: MiCash Prepaid MasterCard

Of course, it’s hard to pay bills in cash without having to visit the payment offices of your gas, water, sewer, electric companies, and sometimes these aren’t even local to where  you live. They also may not accept cash payments in the mail, and besides, it certainly isn’t wise to mail a lot of cash in an envelope. Thus, it’s highly likely that the majority of people who rely on the envelope system pay their bills online through an ACH transfer out of a bank account, or with a debit card or credit card account number. They only use the envelope system for food, eating out, and other purchases that you would make at a cash register in a store.

Here’s the biggest problem we see with the cash envelope system. It’s risky to carry a lot of cash. If you cash your paycheck at a check cashing service, you will pay a check cashing fee (versus paying no fee for direct deposit to a bank account or prepaid card account).  You might get robbed walking away from a check cashing place or at any point on the way home. Your cash stash might get stolen by anyone who discovers it in your home.

Finally, some personal finance gurus argue that using cash actually makes you spend more. If you have three twenties in your pocket, a $5 ice cream cone is in easy reach as a spontaneous purchase, but you may resist that cone if you thought about putting it on a credit card or prepaid card, just because it’s a small purchase put on plastic, and some merchants frown on that due to the swipe fees they pay.

Virtual Envelope System

Now imagine that you are using some budgeting software. Today there are many to choose from, or you can even set one up yourself in a simple spreadsheet. You set your budget categories in your electronic budget system. Your starting point might be historical spending going back a year or six months. It’s easy nowadays to download your transaction history from your checking accounts, credit card accounts, and/or debit card accounts. Then import that transaction history into your spreadsheet or budget software. Budget software can even show you your spending categories in a nice pie chart view, or  a table that may help you recognize patterns such as overspending immediately after payday.

Next, like the real envelope system, you divide your savings balance among your different categories. Then—and here’s the harder part with this digital system—you have to have the discipline to not go over your spending limit in each budget category or “virtual envelope.” How do you do this? By checking your budget spreadsheet each time you go out the door, so you know where you are for that category. Say, your “monthly MP3 budget” is $10 and you see that you’ve spent $10 last night downloading ten songs on iTunes, then you can’t buy any more MP3s until next month.

How debit cards make this easy is that you rely on them for all your spending. Avoid your credit cards (because you are likely trying to pay them down). Then, when you download your transaction history, all of that data will flow into your various spending categories automatically.

With a debit card you might lose it or get robbed but your money can remain safe. You have eliminated the risk of carrying cash. You will hopefully think twice about using your plastic for small spontaneous purchases.

With either system, you should soon learn the fine art of budgeting and be on your way to financial well being.

Envelope System for Saving Money vs. Using Debit Cards is a post from: MiCash Prepaid MasterCard

Illinois Senator Dick Durbin added an amendment to the financial overhaul legislation which directs the Federal Reserve to issue rules to ensure that debit card swipe fees are reasonable and proportional to the processing costs incurred. Right now Visa and MasterCard charge debit swipe fees of around 1 percent to 2 percent of the transaction amount — among the highest rates in the industrialized world. The Durbin Amendment, as it became known as, did not address credit card swipe fees, which are higher than debit card swipe fees and will likely remain so.

The new law also prevents card processing networks from forcing transactions to be run on only one card network. By giving merchants the option to run on more than one network, the hope is that competition will keep interchange rates down. Merchants can now also decline to allow a consumer to use a credit card for small transactions (say less than $10) where the interchange fee would represent too great a percentage of the overall purchase. This means that stores and gas stations can offer discounts to buyers who use cash or a debit card over a credit card, or conversely charge a fee to credit card holders to cover their higher swipe fee costs.

So, the bottom line is that lower swipe fees are good for the consumer. Banks, however, lobbied hard but failed to protect the fat profits they have made by continually raising interchange fees to merchants.

Lower Swipe Fees Are Good for Prepaid Cardholders is a post from: MiCash Prepaid MasterCard

Aside from the stunning dip that marks the recession, this chart shows that corporate profits (not adjusted for inflation which has been low at any rate) are even higher than their last peak in 2006. Is this a sign that the economy is on the rebound? Not if you consider that employment nationwide is still hovering a little below 10% and is much worse in states like Michigan.

Why have profits rebounded ahead of jobs? The biggest reason is that corporations are still not hiring, so the remaining workforce is working harder, as factories build up inventories, and companies began to do more business. Bottom line productivity rises, but at the expense of employees who are doing more work for the same pay–or even at reduced pay because so many employers cut out cost of living increases or even reduced pay in the teeth of the Great Recession.

If corporate profits remain high, at some point the workforce will be maxed out or burned out, and hiring will pick up. Best case scenario the economy witnesses a healthy rebound. Worse case scenario, we get a “double ditch” recession as the recovery sputters, and more people get laid off, consumer spending drops, and the cycle begins all over again.

Corporate profits have rebounded but not jobs is a post from: MiCash Prepaid MasterCard

Fraud experts say that hackers often steal personal data and make multiple small charges to validate a card, probe its vulnerability and test the vigilance of a cardholder before making bigger charges.

Tip: check your credit card and debit card transaction history regularly, preferably online where you can spot a fraudster’s activity more quickly. Report even the smallest transaction that you don’t recognize.  Do this especially if you recently stayed at a hotel or motel. And don’t never leave credit card receipts lying around in your car or anywhere else. As the this article recommends, shred them. Shredders can be had at an office supply store for $20-$40 dollars.

Hotels soft target for credit card hackers is a post from: MiCash Prepaid MasterCard