In Canada, the use of prepaid cards is on the rise. Many people prefer using prepaid credit cards over regular credit cards for a variety of reasons. The most obvious is that traditional credit cards can trap you in an infinite loop of overspending and debt. On the other hand, prepaid credit cards are imbued with a feeling of financial security; since you can’t spend what you haven’t earned, you won’t have to worry about any debt payments. Prepaid cards are also quite popular among the masses due to the simplicity they offer. There are no hidden interest rates, late payment charges, fears of crossing the credit limit, or other dues that might catch you off guard. All you need to do is to load up your card, and you can withdraw your funds anytime, anywhere – without incurring any extra charges.
BMO Prepaid Mastercard – A Brief Overview
The Bank of Montreal is the only bank out of the top 5 Canadian banks offering a prepaid Mastercard. So if you are looking for a prepaid Mastercard backed by a reputable company, BMO Prepaid Mastercard is your best bet. With this product offered by the Bank of Montreal, enjoy a secure and reliable payment method that is essentially as convenient as a regular credit card. All you need to do is load up your card using online banking or the BMO Mobile app, and you can use this Mastercard to shop across 30 million locations.
Features
BMO Prepaid Mastercard offers a variety of features to its users. Here is a list of the most notable features you’ll get by signing up for this prepaid Mastercard.
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Interest rate
The BMO Prepaid card comes without any interest rate. However, all prepaid cards boast this feature. Since users are not borrowing money from the bank while using a prepaid card, there are no interest rates or charges that you’ll have to deal with.
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Approval Time
As one of the instant-approval credit cards in Canada, getting your Mastercard request approved is quick and easy. Once you’ve applied, it usually takes 5-7 business days to receive the card.
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Reward Rates
With a BMO Prepaid Mastercard, you won’t be offered any reward rates. If you are looking for reward rates, consider using BMO Eclipse Visa Card, but this card comes at a hefty annual fee of $120.
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Load Limits on BMO Prepaid Travel Mastercard
You can load your prepaid card with funds ranging from $100-$10,000. However, the maximum amount you can load at one time is $10,000 (using Bank of Canada). Using other modes, such as online banking or mobile app, this load limit comes to $1000.
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How To Load Money
There are two ways you can load money in your prepaid Mastercard.
- Using your BMO Chequing Account. If you have a BMO savings or chequing account, you can transfer funds directly from your account to your prepaid card using BMO Mobile banking. You will get the funds on your prepaid card within a day.
- If you do not have a BMO account, register your BMO prepaid card as a ‘bill payment’ with your financial institution. You can transfer funds from your financial institution to your prepaid card up to $1000 through any ATM, telephone, or online mode of payment.
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Expiration
BMO Prepaid Mastercard expires after three years. You won’t be automatically offered a new card, even if your card is active. If you plan to renew your card, it is better to ask for renewal before the expiry date. When your card expires, you will have to apply for a new card by calling customer care.
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Balance Refund
If any balance remains on your card when the card expires, it will be refunded. In addition, you can opt for it to be transferred to your new account, or BMO will use Equifax or Transunion Credit Bureaus to clear your dues.
Security Policy
BMO doesn’t allow anyone else to use your card. Your card is personalized for you, and unless you share your banking credentials with anyone else, no one can use your BMO prepaid card for unauthorized purchases.
In case of a lost or stolen credit card, you can temporarily lock or reset your PIN to prevent any other person from using it.
A Breakdown of Rates and Fees
Here is a complete breakdown of all of the significant fees charged by BMO for their flagship prepaid card.
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Foreign currency conversion
BMO offers an exchange rate dictated by Mastercard International. These are the percentage conversions BMO will provide you on foreign currency.
For purchase: +2.5%
For refund: -2.5%
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Annual Card Fee
The BMO Mastercard comes at a reasonable annual card fee of about $6.95. This fee will be deducted from your bank account on the first of every month.
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Inactivity Fee
When your card balance reaches the $0.00 mark, or in case your card expires, you will also be charged an inactivity fee. This inactivity fee comes at $5.00 per month.
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Dishonoured Payment/ Transaction
A dishonoured payment is a fee that you will be charged when attempting to make a payment using your debit card but do not have enough funds to complete the payment. You will be charged $40.00 in case of a dishonoured payment or transaction.
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Cash Balance Refund Processing Fee
A cash balance refund via direct or electronic deposit will cost you $3. However, doing so while using a cheque will see the charges balloon up to $10.
Am I Eligible for a BMO Prepaid Mastercard?
There are no harsh eligibility criteria for a BMO Prepaid Mastercard. However, you need the following to be eligible for a BMO Prepaid Mastercard.
- You need to be a Canadian citizen.
- Be of legal age in your province.
- A permanent Canadian address.
Unlike applying for a credit card, you are not required to have any fixed income or credit history while using a prepaid Mastercard. Therefore, you also don’t need to worry about any minimum credit rating or any income threshold.
Another criterion that might make you ineligible for a Prepaid Mastercard is if you’ve declared bankruptcy in the last seven years.
How to Apply for BMO Prepaid Mastercard
If you’ve made up your mind about purchasing a BMO Prepaid Mastercard, here is what you need to do to sign up.
- Confirm your eligibility for a BMO Prepaid Mastercard on BMO’s website.
- Enter your personal information, including date of Birth, Name, Address, etc.
- The third step requires you to enter your financial information.
- BMO will carefully go over your application. If everything pans out, BMO will mail you your Mastercard within 5-8 business days.
- Once you receive your Mastercard, activate it by calling the number on the back of your card.
Who Should Opt for the BMO Prepaid Mastercard?
This card would be best for teenagers with an over-spending habit. However, since this card only allows you to spend what you’ve already credited, it comes with spending limits. Interestingly enough, teenagers are the most likely demographic to buy a prepaid card; since they are the ones who usually get in trouble for not putting a stop to their monthly spending.
If you want to purchase a debit card without opening a bank account, a BMO Prepaid Mastercard is the way to go. Unlike credit cards, prepaid cards do not require you to open an account in any financial institution. As a result, you can use this card as your very own ‘budgeting tool.’ This card’s purchase fee/ monthly service fee is also quite reasonable, and you won’t have to break the bank to get this prepaid card.
Several consumers refrain from using their debit or credit card in certain situations due to privacy and security reasons. If you are one of those fellows, then this prepaid card is for you. Prepaid cards confer an additional layer of security to their users.
What Are Some Drawbacks of Using a BMO Prepaid Mastercard?
One of the significant drawbacks of using a BMO Prepaid Mastercard is that the funds in your prepaid account are not CDIC guaranteed. As a result, this card cannot be used for pre-authorized recurring payments. Unfortunately, this means that you can’t rent a car using this card or benefit from loans.
You won’t earn any interest on your deposited funds, and there are no rewards or cashback options provided on this prepaid card. Furthermore, there is no purchase protection or purchase protection insurance for prepaid users. As mentioned before, there is a maximum card balance limit of $10,000 on this card, and this might be a problem for those who are planning to spend big. This reloadable card is best for small-scale online purchases or bill payments.
The Final Verdict
Not all cards are created equal. Similarly, what might work for you might not work for others. In short, this card is best for those who wish to use it for bill payments, small expenditures, and those looking to purchase a card without opening a chequing or savings account. In addition, this card suits those who regularly travel across Canada and need a reloadable or secure credit card. A BMO Prepaid Mastercard is also quite different from gift cards and store-bought cards since it has much greater functionality.
On the other hand, if you plan to take a loan, earn bonus rewards on your deposits, or benefit from insurance policies, this card won’t be a good fit for you. However, you can explore other BMO cards for these benefits.
Also Read:
The Best BMO Credit Cards
Best cash back credit cards in Canada
Best Credit Card For Dining Out
BMO Prepaid Mastercard
If you do not have a credit or debit card, you can make online purchases with a prepaid card. A regular credit card to qualify requires a credit check. If you have a bad credit rating or no credit history, you may not be eligible. There is no credit check with a prepaid credit card, but you can get it at a drugstore, an office supply store, a gas station or a supermarket and use it immediately.
If nobody is willing to add you to their credit card as an authorized user, a prepaid credit card is an alternative. Prepaid credit cards use cards from payment networks such as Visa, Mastercard and American Express, generally accepted online.
The main advantages of prepaid cards are convenience and better money management. With a reloadable prepaid card, you can easily make cashless payments, simplify the management of personal expenses and avoid credit checks. Cheap Prepaid Cards are a safe and convenient way to manage money for those who wish to avoid credit but can not qualify for a checking account through ChexSystems.
Like your bank card, you can use rechargeable Prepaid Cards to access cash at an ATM, pay bills, make online purchases, and send money to friends and family. In addition, you can set a monthly budget and spending limits with a prepaid card to ensure you don’t spend too much. Prepaid cards are the right choice if you want to limit impulse spending and reduce your access to easy credit and debt.
The only advantage of a prepaid travel card is that you never pay interest from a cost point of view. If you use it at an ATM, you pay $1.50 for each BMO-AMV machine in Canada and $4.50 per machine outside of Canada and the United States if you use it there. This seems like a way for travellers to get a check without paying a fee, but you have to pay the $9.95 for the MasterCard.
All amounts apply to the entire BMO Prepaid Travel Mastercard account, including any additional cards in the account. The new Mastercard prepaid travel card, launched yesterday by the Bank of Montreal, does not incur fees or service charges.
If your financial institution does not provide billing on your BMO Prepaid Travel Card, please visit your local BMO office to open a deposit account. If you have a BMO savings account or check account, you can transfer funds from that account via BMO Online Banking to your card. Please see BMO’s Prepaid Travel Mastercard Card Card Agreement with the cardholder accompanying your card for full details of card usage and fees.
KOHO Prepaid Visa Card is a prepaid card for cash lovers. Use it as a prepaid option if you want to stick to your budget and earn rewards. It works like a debit card, but it connects with your KOHO Prepaid Visa Card spending account. The amount you spend on the card is determined by your balance, which acts as a reward card so that you can earn 0.5% cash on purchases over $2 or $3 in each category with the card at an additional cost. You can also obtain up to 12% interest on your balance if you choose to have the card in an account and move it from an issue account to a savings account, but you need to ensure that you set up a direct deposit.
You will receive an interest rate of only 0% on initial purchases for six months from the date of opening the account. Earn 2% cashback on every dollar spent on eligible gas and groceries up to $2,500 spent. Enjoy an introductory 0% APR for the first 12 months you open your account and no annual fee.
The prepaid credit card is Canada’s secure credit card alternative. Several pre-paid Visa cards are issued by the major banks, including CIBC and Scotiabank, but the best deals are the new financial technology companies.
Prepaid credit cards are issued by banks, retailers and other financial institutions using the payment networks Visa, Mastercard and American Express. They resemble gift cards, but instead of being preloaded with money, use them to make payments as with a credit card.
This is a big question because it highlights how confusing the different credit and debit cards can be. The short answer is that prepaid debit cards don’t help you build up your credit history.
Regular credit cards allow you to pay off debts and how you pay them off is an essential factor in your credit rating. If you use a debit card, the transaction costs are deducted from your checking account. As you do not borrow money, prepaid card accounts are not reported to credit agencies and affect your credit rating.
BMO Prepaid Travel Mastercard’s positive reviews have focused on card reliability and security. There have not been many negative comments other than the usual about prepaid cards and the fact that they do not increase your credit rating and occasionally have problems when misused. Capital One’s Secured Mastercard (r) is designed for those looking to rebuild their credit.
The Mogo Visa Platinum Prepaid Card is an excellent alternative to Canada’s prepaid Visa cards. The BMO Prepaid Mastercard Review 2021 will focus on low-fee, interest-free prepaid options and their pros and cons, fees and features.