EQ Bank Launches New Prepaid Mastercard

The past 18 months have been rough for the prepaid credit card industry. Mogo abolished its rewards program, while Stack self-destructed by charging users foreign exchange fees.

I’m happy to report that there’s some good news in this section of the personal financial services market: the online-only institution EQ Bank has quietly launched their pilot prepaid card, and its features are pretty strong.

Let’s get into the details, and hope that this becomes the standard for new products in Canada.

EQ Bank Card: A New Prepaid Contender

From EQ Bank’s own marketing materials, their new card is blasting out its proverbial gate at a gallop. Just take a look at the features:

To summarize the highlights, here’s what the card offers:

Cash back equal to 0.5% certainly isn’t enough to turn this card into your daily driver – for that, you’d be much better off using a card with a higher rate of return, and with rewards denominated in a more valuable program. Also be advised the 0.5% cash back is paid out monthly to your EQ Bank Savings Account, which you’ll need to have in order to obtain and load the card.

Similarly, the 2.5% interest is also paid out to your EQ Bank Savings Account, and is calculated to the moment you spent whatever was loaded. That means you can allocate a slice of your savings balance to your spending card, without missing the opportunity to earn interest on that chunk of change before it is spent. (Note that this rate will fluctuate when EQ Bank adjusts their interest rate on savings accounts.)

While the cash back and interest features are handy, they hardly set the card apart. Instead, the card’s generosity on ATM withdrawals and foreign transactions are by far its most powerful elements.

Not only does the EQ Bank Card not charge ATM fees itself, but it will also reimburse you any fees charged by the machine. You’ll get reimbursed within 10 business days of making a withdrawal.

This “truly ding-free” perk also exists on the Charles Schwab debit card available in the US. It’s great to see this benefit coming to Canada for the first time.

Alas, the ATM reimbursement is only available on withdrawals within Canada, but I hope it comes to extend to the rest of the world – then this card would be a true must-have in any savvy traveller’s wallet!

For use out of the country, you’ll still reap the benefits of no foreign currency conversion fees….