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Operating a business where employees are allowed to charge expenses to the company is a challenge. Money needs to be made available at all times for the purchasing of hotel rooms, booking of flights, and buying of client dinners, among other expenses.
Fortunately, the market has responded to this challenge by creating prepaid business debit cards. A prepaid business card is a card that you can preload with funds, allowing you, and your employees, to only spend what you have pre-allocated.
In this review we are going to focus on one of the top prepaid business cards: the Dash Prepaid Mastercard. The Dash card is issued by Sunrise Banks, a small banking chain in Minnesota. Dash is suitable for organizations of all sizes looking to manage their expenses.
Let’s take a closer look at what the Dash card can offer your small business. But first, let’s get a better understanding of the benefits of a prepaid business card.
When it comes to employee-generated expenses, business owners typically have two options: a business credit card or a prepaid card. Each has its benefits. With a business credit card you don’t have to preload funds, and many offer rewards in the form of cash back or airline miles.
However, with a business credit card the charges can accumulate quickly. A small business owner needs to have a tight grip on where their business’s money is going. This makes a prepaid card ideal for a few reasons:
With a prepaid card you can only spend what you have budgeted for. Period. That means you don’t need to worry about interest or credit card debt. Furthermore, most prepaid cards allow you to specify what they can be used for, and allocate different budgets to different employees.
Prepaid cards are usually issued without a credit check, which is ideal for the small business owner with no credit history, or bad credit. However, note that you cannot build credit using a prepaid card. If that is your goal, consider obtaining a secured business credit card and upgrading to an unsecured card down the line.
A prepaid card provides the ease of use and convenience of a credit card without the risk of overspending. The Dash card is a member of the Mastercard network, allowing you to use it wherever Mastercard is accepted.
Getting your business set up with the Dash card is a fairly straightforward process. Here’s what you need to do to start spending:
Signing up for the Dash card is as simple as visiting the Dash website and clicking the “Sign Up” icon in the upper right hand corner. Dash requires you provide your name, business name, physical address, date of birth, taxpayer identification number, as well as other identifying information, such as a driver’s license or social security number.
Note that you can also try out the Dash card before signing up. To do so, contact the Dash support team at firstname.lastname@example.org and an account manager will reach out to coordinate a time to discuss all the features available with Dash.
If you are approved, a Dash card will be shipped to your business address within six to eight business days. Note that you can only apply for a Dash card if your business is based in the United States.
The first thing you should do after being approved is download the free Dash mobile app on your phone. You can sign in to your account using your email address and the temporary password Dash provides you in your welcome email.
The Dash mobile app allows you to view your card balance, manage your purchase history by classifying your work expenses and uploading receipts, add employees, approve funding requests, and have real-time oversight into how company funds are being spent.
Once you are logged in, you will need to link your account to your business bank account to allow for the transfer of money. You can link up to three bank accounts to your Dash Card account.
To link a bank account, simply click “Company Vault” in your account and choose the “Add Funding Source” option. You will enter your bank information and receive two micro-deposits in your bank account from Dash. Once you receive the micro-deposits (typically within 48 hours), you can verify them in the app.
Once your bank is verified, you can initiate an ACH transfer from your bank to your Dash account. The transfer can take several days to complete, so be sure to fund your account ahead of time. When the funds do arrive, they will be stored in your Company Vault until you distribute them to your Dash cards.
To ensure your account is always funded, Dash offers the option to arrange for automatic reloads. With automatic reloads, an ACH transfer is automatically initiated for a predetermined amount every time your bank is low on funds.
Note that the company vault can hold a maximum of $100,000 at any given time.
You can add a team member by providing their full name and email address in your Dash account. Once you have entered the requested information, the team member will receive an email invitation. Once they fill out the requested information, they will then be added to the Dash account, and a Dash card will be shipped to the business address on file and arrive within six to eight business days.
You can also choose to make team members administrators, giving them the ability to add a bank, initiate an ACH transfer, add team members, view employee transactions, and generate expense reports.
There is no limit to the number of Dash cards you can have on a single account.
Each card can hold up to $10,000. When you distribute funds from the Company Vault, it will be available on individual cards in real time. Within the Dash app, employees also have the option to request funds from the administrator by entering an amount and providing a description.
Administrators have the option to set individual approval limits on cards. For instance, you can arrange for all purchases under $50 to be automatically approved. All funding requests and approvals are also saved for reporting purposes.
The Dash card is accepted at more than 40 million physical and online retailers in more than 210 countries and territories around the world. There is a daily spending limit of $1,000 on each individual Dash card.
Every transaction is captured in the Dash app, with the merchant’s name, category, and date of purchase. Team members can add additional expense details, such as expense category, receipt photos, and purchase details.
Administrators can also make category tags to classify different types of purchases made by team members. To ensure your team never runs out of funding, Dash will also send notifications when the balance in the Company Vault is low.
The Dash app will send daily summaries of transactions, card balances, and deposits. As an administrator, you can also arrange to have push notifications sent to you after every transaction. Dash also integrates with most major accounting software, allowing you to export spending reports for easy bookkeeping.
Dash does not charge any fees to customers for using its product. Instead, Dash makes its money by taking a percentage of every sale from the merchant. This means no fees for activating your card or adding additional cards.
The only fees Dash does charge are for expedited shipping of Dash cards ($35), paper statements ($10.99 per month, though you can opt to only receive estatements), and a $39.99 fee if you close out your account and request to have your remaining funds mailed to your business in the form of a check.
Certain merchants may also charge a tolerance fee. This is an additional 20% fee added to your purchase to cover accidentals. Once the transaction is settled, the 20% fee will be refunded to the customer’s card.
Dash also charges a 3% fee on foreign transactions.
There is a lot to like about the Dash card, but two things stand out in particular:
Free is obviously the best price, and that is what Dash offers to its customers. With most other prepaid cards, you can expect to pay monthly maintenance fees or a fee to add additional cards. But not with Dash. It can’t really be overstated that this is a remarkable deal.
The fact that Dash is free is even more astounding when you consider the range of functionality you get with the Dash app. You can effectively manage your money however you need, and the interface is simple and intuitive. We’d say there is barely any learning curve here.
Whenever we are told something is free, we automatically assume that there is some kind of catch. Well, with Dash, there are three:
The money you put in your Company Vault cannot be accessed at ATMs. This may be undesirable for some businesses that want their employees to have cash on hand.
Other prepaid cards offer multiple ways to reload an account, such as direct deposit or wire transfer. With Dash you can only add funds via ACH transfer. This is less than ideal because ACH transfers typically take one-two business days to complete.
If your employees make a lot of expenses on behalf of your business, Dash’s spending limits may be, well, limiting for you. You can only have $100,000 in your account at any given time and $10,000 on each individual card at any given time. Plus, team members can only spend up to $1,000 a day. Other prepaid cards offer higher limits than Dash.
If any of these cons make the Dash card unsuitable for your business needs, here are some alternatives to consider:
If you don’t need high spending limits, but want more reload options and ATM access, the Netspend Small Business Prepaid Mastercard is a good option for you. With Netspend, you get access to a network of 130,000 ATMs nationwide, the ability to reload your account via direct deposit, and the opportunity to sign up for ProPay, which allows you to accept credit card payments via a mobile card reader and deposit the funds directly into your Netspend account.
However, Netspend has a maximum balance of $25,000 on the account and a maximum daily spend limit of $5,000. The service costs $9.95 per month plus an additional $1.95 for every card you have on the account after the initial card. You can have 10 cards in total.
If you need a prepaid card that can accommodate a lot of spending, consider investing in the PEX Prepaid Visa. This card has no spending limits and the ability to add up to $25,000 to your account every day. There is also an API that allows you to customize your account.
In terms of cost, each PEX card comes with a $7.50 fee per month. There is also a $49 setup fee. However, PEX will waive all fees if your business spends $50,000 each month.
As a small business owner, you know that nothing is free. That’s what makes the Dash card such an impressive product. At no cost, we would recommend any business give it a try.
For small businesses on a budget in particular, you can’t do better. Larger businesses can also benefit from Dash as long as their employee spending isn’t too high. There are a few bells and whistles missing from Dash, but overall you’d be hard-pressed to find a better deal in the prepaid card market.