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5 Things to Know About Green Dot Credit Cards

March 20, 2020
Credit Cards, Credit Cards for Bad Credit
5-things-to-know-about-green-dot-primor-credit-cards
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Green Dot credit cards carry relatively low interest rates compared with competing secured credit cards, and unlike with most other issuers, applying for one won’t impact your credit. (Green Dot doesn’t do a hard pull on your credit report.)

However, all three Green Dot cards come with annual fees, and that’s a big and ongoing drawback. Even potential applicants with poor to average credit can find alternatives in the secured card space that don’t charge annual fees, such as the Discover it® Secured or the Capital One® Secured Mastercard®.

Those cards do carry higher APRs, though, so if you have poor to average credit and you also plan to carry a balance on the card, you might want to consider the Green Dot credit cards despite those pesky fees.

Here are five things to know about these three Green Dot credit cards:

» MORE: NerdWallet’s best secured credit cards

1. The cards require a refundable security deposit

A secured card functions like a regular credit card — you can use it to make purchases and then pay off the balance, or a portion of it, each month — but you must first put down a refundable security deposit.

Generally, your credit limit will be equal to that deposit. For all of these Green Dot cards, the deposit can vary between $200 and $5,000; you can put down a security deposit up to your approved credit limit.

» MORE: NerdWallet’s best starter credit cards

2. You’ll also owe fees

While there are no processing or application fees, you’ll face other charges. First, you’ll owe an annual fee, regardless of which card you choose:

  • The Green Dot primor® Visa® Classic Secured Credit Card carries a $39 annual fee.
  • The Green Dot Visa® Secured Credit Card has a $39 annual fee.
  • The Green Dot primor® Visa® Gold Secured Credit Card features a $49 annual fee.

(The Green Dot primor® Visa® Gold Secured Credit Card has a lower potential ongoing APR. More on that later.)

The cards also charge a foreign transaction fee of 3%, meaning none of them is ideal for use internationally.

Consumers with thin or no credit might want to instead consider alternative credit cards that don’t charge such fees, such as the Petal® Visa® Credit Card. It’s an unsecured card, meaning it doesn’t require a security deposit, and it offers rewards. Its annual fee is $0.

» MORE: NerdWallet’s best credit cards for bad credit

3. The Green Dot Visa® Secured Credit Card doesn’t offer additional benefits

Despite having the word “platinum” appear prominently on the card, the Green Dot Visa® Secured Credit Card doesn’t offer extra perks befitting its fancier appearance.

In fact, compared with the other two Green Dot options, its interest rate is significantly higher. The ongoing APR is 19.99%.

The Green Dot primor® Visa® Classic Secured Credit Card, for example, charges the same annual fee but offers a lower interest rate. The ongoing APR is 13.99%.

The Green Dot primor® Visa® Gold Secured Credit Card charges the highest annual fee but features the lowest interest rate of the three. The ongoing APR is 9.99%. An APR in the single digits is unusual among cards aimed at people with poor credit. That’s a reason it’s featured on our roundup of best secured cards. Depending on how large of a credit card balance you need to carry, the slightly larger annual fee may be worth it.

There is no penalty APR on these cards (although paying late can still hurt your credit scores, and you can be charged a late fee).

» MORE: Can’t get a credit card? Try these alternative options

4. You won’t earn any rewards

While that’s not unusual among secured cards aimed at people with poor credit, it can also be frustrating for consumers eager to use credit cards to earn cash back or rewards points.

When you’re just starting out with credit cards, rewards aren’t the most important thing — but you can still find some secured and alternative options that earn them. The Discover it® Secured, for instance, earns 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases every quarter, automatically (1% cash back on all other purchases). You’ll have to put down a $200 minimum deposit, but unlike these Green Dot cards, the annual fee is $0. Plus, Discover will automatically match all the cash back you’ve earned at the end of your first year.

5. They can function as steppingstones to better cards

Just as with many regular credit cards, Green Dot reports credit card behavior to the three main credit bureaus, allowing you build your credit history. And as you do so, you can become eligible for better cards, meaning regular unsecured products that do not require a deposit. These cards may also have no annual fee and/or earn rewards.

However, you won’t be able to “graduate” to such a product with Green Dot, as the company doesn’t offer any such unsecured cards. You can, of course, apply for one with another issuer, but if you want your Green Dot deposit back — and stop paying the annual fee — you’ll have to close your Green Dot account. (And closing an account can have implications for your credit scores.)

Other issuers of secured cards (Discover and Capital One, for example) offer clear “upgrade paths,” potentially allowing you to move up to a better product within that issuer’s “family” of cards without having to close your account first.

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