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You might have had your first encounter with a prepaid debit card when your parents tried to reel in your spending as a teen. But a prepaid business debit card is nothing like what you used decades ago. These types of prepaid debit cards are much different than the ones of your youth because they’re made specifically for business owners. They’re also one of the very best ways to control spending within a team of employees.
Think about it—because prepaid business credit cards are less risky for card issuers, you won’t have to wade through normal business credit card applications to get one. And that can be a huge game changer if you’re working with less-than-stellar credit.
Once you get a prepaid business debit card, you simply preload it with however much money you want, and send it off with someone to go get what you need. It may also save you money because fees for prepaid cards have fallen over the years, making it more affordable than traditional cash or even check transactions.
We’ll break down all the details on your top options for prepaid business debit cards so that you can find the perfect one for your unique needs.
You have a few different options for your small business spending: prepaid business debit cards, business checking account debit cards, and business credit cards. Comparing them to prepaid business debit cards, there are differences and similarities:
A prepaid business debit card is different from the debit card attached to your business checking account. There’s a limit on both—but with a prepaid business debit card, you’re loading a balance onto the card that you determine from your bank account, and the cardholder can only spend up to that amount.
That’s unlike a business bank account debit card, which is drawing against any balance you have in your account. Although technically there is a limit on that card, too, it doesn’t come from the card itself—it’s determined by the balance of the bank account. In other words, there’s no limit on what you can spend on that kind of debit card, as long as you have the funds in your account for the purchase. Since it’s not a line of credit, of course, you can’t spend beyond it.
With a prepaid business debit card, you can only spend what’s on the balance of the card. This is money you’ve already provided up front.
Unlike other types of business credit cards, there’s no revolving line of credit—aka credit you can utilize again once your balance is paid off. So, with prepaid business debit cards you can only spend money you definitely do have. You can think of credit cards as borrowing money, which is different.
There is a similarity, though: Prepaid business debit cards often also have a card network logo on them like American Express, Mastercard, or Visa. That means they can be used like a business credit card at any place that accepts these types of cards—but, again, you can only spend up to what’s preloaded on the card.
There are lots of reasons why a small business owner would choose to opt for a prepaid business debit card. It could either serve as your primary business credit card, or supplement a main business credit card as another vehicle to help manage spending.
Prepaid business credit cards come with their own unique set of advantages that just might be right for your small business:
If you think that a prepaid business debit card is the right choice for your business, let’s look at the best ones available.
The Bento for Business Prepaid Mastercard is the standout among the best prepaid business debit cards for small business owners. Especially, if you’re a new business, startup, or in early growing stages, Bento allows you a lot of runway as your small business is evolving.
Bento is one of few prepaid business debit cards that gives you the first two cards for free. After the first two cards, you’ll only be charged flat fee per account on a sliding scale, rather than per card. That means that more of these prepaid business debit cards you have attached to your account, the cheaper the price per card it’ll be.
For a Bento prepaid business debit card account, you’ll pay the following rates:
Bento will also waive these fees if your business spends more than $20,000 a month on your prepaid business debit card account.
Additionally, there won’t be a credit limit on this prepaid business debit card—other than, of course, the amount of capital you preload onto your account and the limits your set for your employees.
With this prepaid business debit card, Bento will limit your daily load and card transaction volume up at $25,000 daily. For a significant number of small businesses, this shouldn’t be a burden—and the vast majority won’t come anywhere near that. But it’s worth keeping in mind so you know about it. If you’ll be spending that much money on a card daily, and you know you have the funds to back it up (which you must, since this is a prepaid card…) you’ll want to be looking at a business credit card that’ll give you rewards for your big spending—like cash back or travel rewards.
One of the best parts of the Bento for Business prepaid business Mastercard is its integration into business accounting software. First, there’s a a mobile app and a spending dashboard to help business owners to see where their allocated funds are going—and to allow card users to upload related documentation. But Bento will allow dataexport and integration into accounting software like QuickBooks to help make your life even easier come tax time. This will also help you get an even better hold on your spending as a small business owner, especially when it’s time to graduate to a business credit card.
Another free prepaid business debit card is Dash. With Dash, you’ll add funds to your account via bank transfer into what Dash calls a company vault. From there, Dash will allow you to disburse funds as necessary to employees. Your team will then have their own cards to use towards business expenses.
One of Dash’s strongest features is its robust mobile app. Through Dash’s system, employees can request funds for their prepaid business debit card by providing an amount and a description for their expenses. You’ll then get to approve or reject it. If you approve an employee’s request, the money will immediately be available in the employee’s Dash account.
With Dash employees cards, you can set different limits or even suspend a card should you need to. Dash also provides the option to automatically approve employee requests, as long as each request is within the limit you set. Dash will provide a record of the request and your team can make the necessary purchases more efficiently. You can also freeze and suspend a card remotely if you need to. This is especially great if you work with contractors or gig workers, and you’re not entirely sure how long they’ll be with you, or you don’t have a solid relationship with them yet.
There are limits to how much you can load onto this prepaid business debit card, though. You can only have a maximum of $100,000 in your account within one calendar month, and a maximum of $10,000 when transferring from the company vault to an employee card. Dash also forbids using their accounts for payroll expenses.
You can’t use this prepaid business debit card at the ATM. Really, Dash aims to function as a business credit card. However, if you prefer to use a Dash prepaid business debit card like a business bank debit card, you’ll need to set a PIN number in the mobile app beforehand.
Working with a remote team has its own challenges. Other than syncing calendars and timezones, few issues are more complex across distributed organizations than payment. Emburse prepaid employee debit cards looks to address this with virtual cards. Simple, but perfect.
To set up employee cards off of a main account, Emburse uses just an employee’s name and email address, and creates a prepaid business debit card account. You can spend on these just like like other cards, plus set spending limits, toggle them on and off, set restrictions and more.
But here, everything is virtual—and since there’s never a physical card, you don’t have to worry about taking a card to the mail and waiting a few days for it to get to your employee (or worse, getting it stolen). Plus, once you issue your employee’s Emburse card, it’s active. These virtual cards also have the same protection and security that any other type of prepaid debit Mastercard would, don’t worry.
Emburse also offers a dashboard with a spending breakdown so you’ll be able to see where the money is going and integrate into your bookkeeping software, and get instant receipts for each transaction.
For Emburse pricing, you’re looking at:
And they also offer pricing for their API, so larger organizations can create custom solutions and issue their own cards. That’s $0.25/card with a $500/month minimum. If this is interesting to you, check out all of their offerings—the employee prepaid card is only one type of their prepaid business debit card offerings.
The PEX business prepaid card is a great option for those who run larger businesses, or who know that their company is on the cusp of explosive growth.
For one, the PEX prepaid business debit card won’t cap the number of transactions that your team can perform in a day. Plus, PEX won’t impose limits on how much you can spend, unlike the other prepaid business debit card options on this list, which will limit the amount your team can spend in a given time period.
Each time you preload capital onto your PEX account, you’ll be able to load up to $25,000, and there’s also no minimum balance amount. This prepaid business debit card will also allow you to attach up to 100 employee cards to you prepaid business debit card account, which will be ideal if you need to give a large team access to cash.
When you sign up for the PEX prepaid business debit card, you don’t need a personal credit check or a guarantee from the business owner. The approval process is simple and can take anywhere from 1 to 3 business days and then 7 to 10 to receive your first card.
All that said, the fees attached to the PEX prepaid business debit card tend to be on the more expensive side—starting at $75 per month for a 20-card account along with the $49 one-time setup fee. Not to mention, you don’t get ATM access with this business prepaid debit card, which is inconvenient if your team need to access cash frequently.
PEX will waive all of these fees for every month your business spends more than $50,000 on its prepaid business debit card. But unless you need a lot of capital or know you’ll be making a large number of transactions on your prepaid business credit card account, you may want to consider passing on this business prepaid debit card.
It’s worth noting, though, that PEX is very robust on the tech side of things. Not only does it have the app and reporting functionalities that Bento does, but it allows a high level of customizability for large businesses with development teams. The PEX API will allow your business to create a custom finance system with an emphasis on real-time data that works specifically for your company if you’re interested in making the investment. That’s pretty cool.
The Netspend Small Business Prepaid Mastercard is a great choice for those who want more options with their prepaid debit card. It’s great for businesses are who are still small, or those who are looking to grow their team. You can load up to $25,000 per day to your account and employees can spend up to $5,000 daily. One of the best perks of this card is that you’ll get instant approval, and your card should arrive within 7 to 10 business days.
Loading funds is easy, as you can do it via check, ACH transfer, direct deposit, or even through a physical reload station. It takes 2 to 3 days to load funds initially. There’s also a mobile app you or your employees can use to make deposits and the money could be available within minutes.
Once you activate and verify your ID, you can create up to 10 sub-accounts. You’re able to keep track of these accounts via your online and even have the ability to download your transactions to Quickbooks in a snap for tax season.
As for fees, you’ll need to fork over $9.95 a month and an additional $1.95 month for each sub-account. You’re looking at a maximum of $27.50 a month if you use the maximum number accounts.
Although that’s not bad for a base fee, you will need to watch out for additional fees that can really add up. Netspend charges you $2.50 for every ATM withdrawal and $0.50 for balance inquiries at the ATM. If your transaction gets declined, you’ll be charged $1 each time. So, although this card does allow you ATM access, you’ll need to make sure you use it judiciously.
Sure, the Capital One Secured Mastercard isn’t technically a prepaid small business debit card. In fact, this credit card is neither a business card nor a prepaid card at all—it’s actually a personal, secured credit card.
Regardless, this card is a great step toward building your personal credit history, which is crucial if you want your business to eventually graduate beyond prepaid business credit cards and into unsecured business credit cards. If you’ve got bad credit or no credit at all, then a secured credit card will be your best friend in building or rebuilding your personal credit. And this, in turn, will allow you to access unsecured credit for your business.
With the Capital One Secured Mastercard, you’ll need to provide security deposit for your line of credit. That means you can only spend however much you deposit. In a way, this option acts much like a prepaid debit card, except it allows you to build credit. So, if you have the funds to back up a prepaid debit card, you might just want to use a secured credit card to get a little extra out of it.
There’s no annual fee, so the Secured Mastercard can be the perfect, credit-building complement to your prepaid business debit card—or if you’d like to put all of your business spending on this card, that’s an idea, too. (Just don’t mix business and personal spending!)
There are lots of great benefits to prepaid business debit cards—that’s easy to see after reading this, we hope! You should, however, be aware of a few drawbacks that come with them, too:
Some business credit cards—including ones from American Express and Bank of America®—will allow you to set employee spending limits on cards attached to your account. So, if you end up opting for an unsecured business credit card, make sure that you set clear rules with your employees on card usage with your employees. This could include employees providing itemized receipts or filling out expense reports. You could even go so far as to outline the consequences for unapproved purchases and that any rewards earned are for the business.
If you’re not keen on paying monthly or even transaction fees, there are many free business checking accounts that will also provide you with free business debit cards. Some business checking accounts will let you earn a bit of interest and may even provide free checks, saving you some cash there.
No matter whether you decide to use a regular business checking debit card, or a prepaid business debit card, you’ll need a great business checking account for both. Make sure you’re set up with the right one for your small business.
Find Your Best Business Checking Account
In short, probably in some way! Even if you have a regular business credit card, or you need to find a way to help your employees or contractors spend in a supervised way, there’s likely some way to use a prepaid business debit card to spend smarter.
Whether you want to track your category spending habits more closely, stick tighter to a budget, integrate into your accounting software, or give your employees a little more freedom (but not too much!), a prepaid business debit card is a fit for many businesses. Give one a try and find out.