Not credit, not quite a bank account, and not the same thing as the gift card beside it on the peg. Here's what the model is, where the limits sit, and who it suits.
Independent guide, not a Netspend site. Netspend sets the card terms, fees and eligibility — not us. We may earn a commission from links here at no cost to you. Details were checked against Netspend's published terms on 5 November 2026 and can change.
The short version
A store-bought prepaid card is a demand deposit account on a peg. Once activated it has a routing number, an account number and a card number, and it can receive a salary, pay bills and spend anywhere the network is accepted.
Netspend is the worked example here because it's the one this site covers. The card is issued by Pathward, N.A., and the account sits behind the Netspend brand rather than at a branch you can walk into.
The peg is what makes it different from opening an account online: you buy the placeholder at a register, take it home, and activate it yourself. No appointment, no branch visit, no credit check.
| Store card | Credit card | Bank account | |
|---|---|---|---|
| APR | None | Yes | On borrowing |
| Credit check | No | Yes | Usually |
| Spend before loading | No | Yes | Yes, with overdraft |
| Branch access | No | No | Yes |
| Cheque book | No | No | Yes |
Two things follow from that table. First, there's no way to spend money you don't have — the card declines rather than lending. Second, there's no interest on the balance, so it isn't a savings vehicle either.
Identity verification still applies, because federal rules cover most prepaid accounts. That's the SSN prompt at activation, and it's covered in the step-by-step walkthrough.
They sit on the same peg and look similar, but a gift card is a fixed pot that can't be reloaded and usually can't take a deposit. A store card is an account: it reloads, it takes direct deposit, and it has a routing number.
If the card came off a rack of $25–$100 fixed-value cards with no activation step, it's a gift card. If it needed activating and asked for an SSN, it's an account.
Limits are the trade for no credit check. They're set by tier and verification level, and a partially verified account sits at the bottom of the range — often low enough that a single wage won't fit.
The verification guide covers clearing the flag that causes it, and the reload page covers the ceilings themselves.
Fees are the other limit. The fee schedule lists every charge and what waives it — direct deposit removes the monthly fee entirely.
People who can't open a standard account, or don't want the credit check: thin credit files, recent arrivals, people who've had an account closed, and anyone who wants a spending ceiling that's enforced rather than optional.
It suits people paid in cash or by an agency that will deposit, and people who want the salary to land somewhere the rent can't overdraw.
It suits less well if a large balance will sit untouched — no interest accrues — or if branch access and cheques matter.
No. It's a deposit account. Money is loaded first and spent after, with no APR and no interest.
Partly. It has routing and account numbers and takes direct deposit, but there's no branch and no cheque book.
Federal rules. Most prepaid accounts can't open without it, and there's no way around the SSN field.
Not on its own. It's a deposit account, so nothing is reported as borrowing. Some tiers offer a credit-building feature — check the cardholder agreement.
A gift card is a fixed pot that can't reload. A store card is an account that can.