Review of the Vanilla prepaid card (and an alternative you should consider instead)

Prepaid gift card with activation fees

Prepaid cards have plenty of appeal. While they offer many of the features of a traditional credit card, they are a convenient way to manage your money and avoid interest. With that in mind, we aim to share essential information on various personal finance products to help you make the most informed decision for your next purchase.

Let us take a look at the Vanilla Visa and Mastercard prepaid card. You may find that this card is exactly what you need, or you may consider another option.

Let’s take a closer look at the pros and cons of this card, and present some excellent prepaid alternatives that we personally recommend.

What Are the Vanilla Visa and Mastercard Prepaid Cards?

The Vanilla prepaid card is available in Visa and Mastercard versions. The only notable difference between the two is that the cards come in different denominations.

For example, the Vanilla Visa prepaid card is available starting at $50, with other denominations of $75, $100, $150, and $250. The Vanilla Mastercard prepaid card option starts at $25, with denominations ranging from $25 to $500.

Other than that, they both serve the same purpose and are reliable options to choose from. Therefore, you can choose the one you feel most comfortable with.

The cards may not be accepted at the same merchants. If a retailer accepts Mastercard, it will not necessarily accept Visa (such as at Costco!). Other notable Vanilla products include:

There are also similar prepaid cards, such as:

Main Features of the Vanilla Prepaid Card

The main benefits of the Vanilla prepaid card are as follows:

How Does the Vanilla Prepaid Card Work?

Vanilla prepaid cards are readily available at various stores, including Walmart, 7-Eleven, Couche-Tard, and many other participating retailers. Unlike other prepaid cards, you do not need to provide a personal background check or a credit score to buy one.

This means you can also buy as many cards as you want. The card is also simple and intuitive to use. Once you have purchased the prepaid card and signed the back of the card for verification purposes, you are ready to use it. It’s easy!

When purchasing, carefully check the barcode on the packaging. If it looks altered, scratched, or if there is another sticker over it, do not buy it and inform the merchant. Fraud cases are unfortunately common with this type of prepaid card.

Vanilla Prepaid Card Fees

Although the Vanilla prepaid card is presented as “free after purchase”, the situation is more nuanced than that.

You will have to pay fees at purchase, including an initial activation fee when you buy the card. For Mastercard, the fee can range from $3.95 to $8.95. Conversely, the Visa card ranges from $3.95 to $7.95.

If you buy a lower denomination, these activation fees can represent between 10 and 15% of your purchase!

You should also know that a 2.5% foreign exchange fee is charged when you make purchases in a currency other than the Canadian dollar. Therefore, avoid using such a card when travelling abroad.

However, purchasing many prepaid cards or gift cards, especially $500 cards, is a red flag for some credit card issuers. We have had many cases of readers whose credit card was closed due to purchasing these prepaid cards too frequently.

In fact, it is clearly stated in the terms and conditions of the American Express credit or charge card that the purchase of these prepaid cards is prohibited.

Be cautious about repeated purchases of a prepaid card, as your credit card issuer may find this suspicious and trigger a financial review.

Disadvantages of the Vanilla Prepaid Card

The Vanilla prepaid card has several disadvantages that may be important to you:

1. Non-Rechargeable

The Vanilla prepaid card is not reloadable. When you have used up the balance on your Vanilla prepaid card, you must buy a new card. If you want to keep Visa or Mastercard prepaid options, you may consider other Vanilla products, such as MyVanilla, which offer reload capabilities.

2. No ATM access

Another drawback of this prepaid card is that you cannot use it at an ATM to withdraw cash or get cash back at the point of sale.

3. No Rewards

If you thought you might be able to use this card to earn great rewards points on your purchases, think again. The Vanilla prepaid card is very basic and does not offer the benefits you would expect from a Visa or Mastercard card.

4. Fraud

As soon as it is activated, has the money on your prepaid card disappeared? Call the customer service phone number on the back of the prepaid card right away. They will help you, but expect several weeks before you get your money back.

If you want to check the balance on your prepaid card, go directly to the prepaid card’s website and not via Google. Many fake websites look like the real ones and take advantage of this to obtain your prepaid card numbers. Then, your dollars can vanish.

5. Use it down to the last cent

After your purchases, you may end up with a remaining balance of a few dollars or a few cents. For example, how do you use that annoying last $0.76 left on a $500 prepaid card?

At checkout, ask to pay using two payment methods. Keep in mind that the merchant may refuse to do so. You will therefore have to keep your prepaid card in your wallet for a little while longer.

Vanilla Prepaid Card Alternatives to Consider

In our opinion, the best prepaid card according to Milesopedia since 2022 is the KOHO Extra Mastercard prepaid card.

It’s a rechargeable card with many benefits, including cash back with eligible retailers, direct deposit, and no foreign conversion fees (Extra version only).

You can even use it at Costco!

Alternatively, the EQ Bank Card is another excellent choice:

Verdict

A full review of this card will tell you that, while it is very convenient, a prepaid card is not that exceptional and comes with many red flags.

However, if you’re using it for practical purposes, the Vanilla prepaid card can come in handy.

Keep in mind that the perfect prepaid card doesn’t exist… yet.

Frequently Asked Questions About the Vanilla Prepaid Card