Overdraft protection by NetSpend may answer your problems if you are struggling to afford something but it does come with some specific requirements.
It’s no surprise that occasionally you may need a little help with cash.
Things can come that are unexpected, like a boiler breaking or a kitchen appliance no longer working as it should, you may initially worry that you can’t afford to replace the item, but with an overdraft, you will be provided with the ability to fix the problem by using money that is essentially loaned to you. This is what an overdraft is.
This is a short-term problem solver and is used when you don’t have the right amount of funds to make a payment.
NetSpend offers this as well as lots of other banks.
A few things that need to be considered with Netspend’s overdraft policy are that you will be offered an overdraft plan if your balance reaches minus $10.01. You can then enroll but only if you have a direct deposit of at least $500 on a monthly basis. Essentially, if you are employed and earn over $500 a month.
NetSpend will then charge $20 on each transaction you make while being in the overdraft.
However, so you don’t rack up a big bill you can only use it three times for a transaction a month. If you remain in a minus balance for 30 days three different times or for 60 days at one time then the service that is being provided to you will then be canceled.
Read: How Much Can you Overdraft With Netspend All Access Card Limit?
What is Overdraft Protection?
If you are unsure of what overdraft protection is then it is a credit allowance that can be added to your account.
This will provide the user with funds that are available when your account has to reach a balance of zero. The funds allocated will be a specific amount.
It is like a lone system that is offered by the bank. These funds that are allocated to you must then be paid back to the lender of the money.
Overdrafts are seen as being a more affordable option for lots of people instead of getting a credit card as they will often offer you interest rates that are much lower.
You will be charged by Netspend for having an overdraft facility on your account with them, even if it is something that you do not use.
Due to the fallbacks of an overdraft, it is something that should only be used in the case of an emergency and you shouldn’t use your overdraft for everyday transactions.
This won’t be possible with NetSpend anyway as you are only able to use their overdraft system 3 times in one month, this is to stop you from incurring ridiculous charges that you won’t be able to pay back as mentioned it is in essence a loan system.
This service won’t automatically be offered to you because you don’t have any money in your account though and NetSpend will need your permission to provide you with an overdraft service so you can determine if it is the right option for you.
Read: How to Enroll in NetSpend Overdraft Protection?
NetSpend Overdraft Eligibility And Activation
Activating your overdraft protection provided by NetSpend is a very easy thing to do.
You simply need to provide them with an email address that is valid and also agree to the new terms and conditions of your NetSpend overdraft protection contract, as stated earlier to be considered as eligible for this you will need to receive deposits into your account of over $500 every month.
You will be notified about the possibilities of an overdraft once you have overdrawn by more than $10. You will then have 24 hours to bring the balance back up to $10, if this is not done you will then be charged $20 by NetSpend as a service charge.
Deactivating Your NetSpend Overdraft
NetSpend will cancel your overdraft protection if you do not receive more than $500 of direct deposits every 30 days and you will then have to follow the steps to re-activate the overdraft protection provided by NetSpend.
Like mentioned earlier if for more than 30 days the account balance is negative 3 times then the overdraft protection will be permanently canceled, this will cancel if the balance remains negative after 60 whole days.
If it is permanently canceled, the overdraft protection feature won’t be offered to you again as you simply will be deemed as someone who is not able to consistently pay back the money that is being loaned to you.
Ensure that you never delete your email address or withdraw any consent for electronic disclosures as this will automatically deactivate your overdraft protection and you wouldn’t know about it.
If this happens you may find yourself in a sticky situation where you need money that you thought you would have but now, unfortunately, don’t.
So it is best to stay on top of this in case it takes you by surprise.
In Summary
NetSpend provides you with the ability to have an overdraft for the unexpected times that you may have to pay for something that you simply can’t afford right now, that could be anything, from car repairs to just insurance payment that you forgot about and have fallen short of paying, an overdraft is a loan system that you will be required to pay back monthly.
You will only be eligible for an overdraft that is offered to you by NetSpend if you have a direct deposit of more than $500 every month, this is to ensure that you are in fact capable of paying the money back that is being loaned to you.
This option may be a better one for you instead of a credit card because overdrafts often charge a lot lower interest rates.
You will only be able to use your overdraft provided by NetSpend 3 times in one month and will be charged $20 every time that you use it.
This will ensure that you are not lending more money than you can actually pay back which would leave you in trouble.
