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What does the term minimum payment mean on a Green Dot secure credit card?

creditmaxguy
New Visitor

What does the term minimum payment mean on a Green Dot secure credit card?

Greetings,

I recently got my secure credit card from Green Dot in which I made an initial deposit of $355. They have an annual fee of $39 which was taken from my initial deposit. I was wondering what the minimum payment of $25 is which is scheduled be paid a month from my initial deposit.

From my understanding, with a regular credit card, you can consume willingly up until your credit limit suggests and at the end of the period you pay for what you consumed. But with a secure credit card you’re already paying up front the money that you will be consuming, so there shouldn't be any monthly payments dates. There is also no monthly fees associated with this card, only transactions fee when you make a deposit at the connivence store.

I deposited $355 and intend to use all of it for that month, and when I hit a credit balance of 0, I plan to make another deposit for the next month. I don't see where the minimum payment comes from if I making my deposits and using it all. Unless I can over my intial deposit $355 which I didn't know since I thought secure meant more a only what you deposited exisit in the card.

Anyone please kindly let me know of this confusion I'm encountering.
Thank you.
Message 1 of 8
7 REPLIES 7
M_Smart007
Epic Contributor

Re: What does the term minimum payment mean on a Green Dot secure credit card?

 

 

 Hi and Welcome to the Forum,

 

Did you pay the annual fee?, it may have posted to your account, and you have a balance of $39

and the minimum payment is due? .. I suggest is if you owe the annual fee of $39 ..pay it in full.

Message 2 of 8
tenaya
Frequent Contributor

Re: What does the term minimum payment mean on a Green Dot secure credit card?

Green Dot secured (and every other secured card) is going to expect to be treated like a credit card. They will have a minimum payment each month, they will charge you interest (on your own money! I know! Smiley LOL ) if you carry a  balance, and so forth. It's not like a refillable debit card, though it sounds like you're going to be wise and treat it like that—spend, pay to the card, spend, pay to the card—lather, rinse, repeat.

 

I had a Green Dot Platinum secured and I always paid it in full each month and never paid any fees (other than the annual fee) or interest. I paid via debit card online and the payment usually hit the card (thus freeing up some of the credit limit) in a day or two. For the platinum secured, I used this link to pay: https://platinum.greendot.com/ I would never, never, ever try to pay via checking account because I have heard they are glacially slow to post the payment. Debit card payment is the way to go. (They used to even let me pay with my Discover IT credit card, but no more, I don't think! Smiley Sad )

 

Edit: You mention paying at convenience stores: I think you can do that, but I only did it once (to give my initial $200 secured deposit). I paid in cash to Walmart and paid a fee. You can avoid paying fees in the future if you pay online with your debit card.

 

Hope this helps! I really liked Green Dot and they helped me with my credit rebuild. 


Overstock $9,750, Walmart $2.5K, Discover IT Cash Back $2.4K, NFCU Flagship $5K (formerly CashRewards), Shell (Citi) $800, NFCU More Rewards $17K, AMEX Cash Magnet $1K, Citizens Cash Back $2.8K, Amazon Store Card $4.2K, Cap1 QS $1.1K, FBNO Visa $1.6K, AMEX Blue Cash Preferred, $8K, eBay MC $800 (RIP Green Dot Platinum Secured)
Current FICO8: EQ 700, TU 700, EX 688   Current FICO9: EQ 715, EX 714
Goal for December 2019: FICO8 640-700 (reached! Fico 681!) | Goal for December 2020: FICO8 685-700 (Reached! 690!) | Goal for December 2021: FICO8 700-740
Starting Score: 539  Current Score: 690  Goal Score: 760
My credit recovery journal

Message 3 of 8
Morpho
Valued Contributor

Re: What does the term minimum payment mean on a Green Dot secure credit card?

You are mixing up two different Green Dot products. What you are describing is how Green Dot prepaid cards work. You deposit an amount and your charges are deducted from that amount.

Since you said you have a minimum payment then you have the Green Dot secured card. The way it works is you do not really have access to the deposit until you close the account. You are accessing a credit line (equal to your deposit) when you make purchases. It works like a regular credit card. Meaning; There is a minimum payment due each month and you also pay interest. Don’t forget that part!

If you decide you no longer want the card you have to pay off your balance completely and then you will get your deposit refunded. Do not just say “well my balance is $100 just take it out of my deposit”. Most secured card will not let you do this. They will report you as delinquent and charge fees that will eat into your deposit.
Message 4 of 8
creditmaxguy
New Visitor

Re: What does the term minimum payment mean on a Green Dot secure credit card?

Yes I just learned that the initial deposit is the credit limit I established for myself. I know can use the card within that limit and pay monthly payments on that. Is that right? I thought it was more like a pre-paid card where i load it and spend it monthly.

Message 5 of 8
M_Smart007
Epic Contributor

Re: What does the term minimum payment mean on a Green Dot secure credit card?


@creditmaxguy wrote:

Yes I just learned that the initial deposit is the credit limit I established for myself. I know can use the card within that limit and pay monthly payments on that. Is that right? I thought it was more like a pre-paid card where i load it and spend it monthly.


the BLUE part is correct!

Message 6 of 8
tenaya
Frequent Contributor

Re: What does the term minimum payment mean on a Green Dot secure credit card?


@creditmaxguy wrote:

Yes I just learned that the initial deposit is the credit limit I established for myself. I know can use the card within that limit and pay monthly payments on that. Is that right? I thought it was more like a pre-paid card where i load it and spend it monthly.


Yes, and it would be good to pay often if you are planning on doing a lot of spending on the card, so you don't max out the limit (show a balance of $355 on a card with a $355 limit). This looks bad on your credit report (but it doesn't do any lasting damage and as soon as your credit balance is paid down, your credit report reflects that positive change).

 

I had a $200 limit and I would obsessively send payments in soon after I charged something. When Adobe charged me $10 for my subscription, I'd wait a few days and use my debit card to pay $10 to Green Dot. And so forth and so on. I sent payments to Green Dot probably every week (depending on how much I was spending). So my Green Dot credit card never really had a chance to accumulate a higher balance. This is a good habit to get into, IMHO.


Overstock $9,750, Walmart $2.5K, Discover IT Cash Back $2.4K, NFCU Flagship $5K (formerly CashRewards), Shell (Citi) $800, NFCU More Rewards $17K, AMEX Cash Magnet $1K, Citizens Cash Back $2.8K, Amazon Store Card $4.2K, Cap1 QS $1.1K, FBNO Visa $1.6K, AMEX Blue Cash Preferred, $8K, eBay MC $800 (RIP Green Dot Platinum Secured)
Current FICO8: EQ 700, TU 700, EX 688   Current FICO9: EQ 715, EX 714
Goal for December 2019: FICO8 640-700 (reached! Fico 681!) | Goal for December 2020: FICO8 685-700 (Reached! 690!) | Goal for December 2021: FICO8 700-740
Starting Score: 539  Current Score: 690  Goal Score: 760
My credit recovery journal

Message 7 of 8
longtimelurker
Mega Contributor

Re: What does the term minimum payment mean on a Green Dot secure credit card?


@M_Smart007 wrote:

@creditmaxguy wrote:

Yes I just learned that the initial deposit is the credit limit I established for myself. I know can use the card within that limit and pay monthly payments on that. Is that right? I thought it was more like a pre-paid card where i load it and spend it monthly.


the BLUE part is correct!


Yes, it is just like a credit card (in fact it IS a credit card!)   It's just that it is secured, so that if you don't pay, the issuer can take your initial deposit as payment.    Otherwise, all normal credit rules of min pay, due date and interest apply.

 

You may feel that you are borrowing against your own money, but a more positive way is that you are getting the chance to build a good credit history, and the price you pay is locking up the initial deposit for as long as you need the card

Message 8 of 8
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