Finance & Money
Prepaid cards and second-chance bank accounts
Two products aimed at people who have had an account closed, with meaningfully different costs and protections.
Prepaid cards hold money loaded onto them and are not linked to a bank account. Fee structures vary widely, covering monthly charges, reload fees, cash machine fees and inactivity fees. Issuers are required to publish a standardised fee summary, which makes comparison between them straightforward.
Second-chance accounts are ordinary bank accounts offered to people who appear in the screening databases banks consult when opening accounts. They usually carry a monthly fee, restricted features for a period, and a route to a standard account after a time.
Those screening databases are consumer reporting agencies, which means you can request your own file and dispute inaccurate entries in it. A closure recorded in error is a common and fixable reason an application is refused.
Credit unions are often the more flexible route, and community development financial institutions are specifically chartered to serve people that larger banks decline.
What to do next. Request your file from the account screening agencies, dispute any error, and ask a local credit union what it offers.
studentaid.gov outranks this page. Rules, figures and dates change
between academic years. This is written to help you read the official sources, not to
stand in front of them. Start there.
Nothing here is a determination. We cannot tell you what you qualify
for, and no website can. The programme and the office that runs it decide that, after
you apply.
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