Neo Prepaid Card Review
Prepaid cards are gaining in popularity. The market is growing at a rapid rate as more Canadians choose them over debit and credit cards. Traditional credit cards may still be preferred by two thirds of people, but this might be explained by the novelty of neobanks like Neo Financial. Our review explains how Neo’s prepaid card is unique and empowers its users to break free from traditional banking.[Offer productType=”SavingsAccount” api_id=”60fee79313fd2f260ff90749″]
Who is Neo Financial?
Because Neo Financial is a fintech and not a traditional brick-and-mortar bank, it is able to save a lot of money on operating costs and give it back to its customers in the form of better rates and rewards. Indeed, Neo Financial is one of the best neobanks in Canada.
Now, you might worry about its legitimacy, since it was only founded a couple of years ago. Neo is a legitimate business. They partner with well-established and regulated institutions such as Concentra Bank, an institution insured by the Canada Deposit Insurance Corporation (CDIC). This protection ensures that your deposits are legally protected up to $100,000. Additionally, Neo Mastercards are issued by ATB Financial, which is the largest public bank in North America and Alberta’s largest financial institution.
Neo Financial Products
Neo offers many of the same services traditional banks do. You can do most of your banking, borrowing and investing with Neo:
- Neo Money, a hybrid chequing-savings account with one of the best prepaid cards
- Neo Credit, a traditional credit card
- Neo Secured Credit, a secured credit card with almost guaranteed approval and no hard credit check
- Neo Invest, to open a tax-free savings account (TFSA), registered retirement savings plan (RRSP) or non-registered investment account with a low management fee
- Neo Mortgage, to get a mortgage at a competitive rate
Let’s focus on Neo Money, the account you should be opening to get a Neo prepaid card.
What is Neo Money?
Neo Money is a hybrid chequing and savings account linked to your Neo Mastercard prepaid card. Like any credit card, the Neo prepaid card earns cashback. It does so at pretty decent rate, at one condition: shop at partner stores. The average cashback on groceries and gas is 2%, which is okay, but you will love that you can get up to 6% at restaurants and 15% at partner stores. If you tend to shop at places that are not Neo partners, you won’t be completely left out. Neo guarantees a 0.5% cashback. However, Neo limits this top-up to $50 per month.
Neo Money is a no-fee account, which means you get free everyday transactions and no monthly fees. There is no minimum balance, but you might want to keep a balance to get 2.25% interest on every dollar! It might not be the best high interest savings account, but it offers a decent rate and it is more practical than transferring money between a chequing and a savings account.
Neo Prepaid Card Review: Main Features
Neo Money and the Neo prepaid card are available to all Canadian residents, except in Quebec. The Neo Money card is issued by Equitable Bank and the Neo Money account is provided by Concentra Bank, a CDIC member institution. Also, you can withdraw cash from any ATM in the world where Mastercard is accepted.
Basically, you can use the Neo prepaid card like you would a debit card. You can access the cash deposited in your Neo Money account and spend it online or in-store without having to manually load funds onto your card. You are not borrowing money, you are simply using the money you already have.
Getting your card is easy. If you already have a Neo Money account, you can get a Neo prepaid card by logging into your account and selecting Card from the main menu.
If you do not already have an account, sign up to Neo Money. You might be surprised to get rewards instantly. I certainly was! To really get the rewards, though, I had to open a Money account and deposit 50$ (for a $5 reward), and ask for a credit card (for a $25 reward).
Opening a Neo account takes less than 5 minutes. Neo asks questions about you, your employment, you social insurance number (SIN) and financial information. They will also verify your identity. As soon as you’re approved, you will be able to set up a virtual card so you can make purchases online instantly. You can also add your Neo prepaid card to your Apple or Google Wallet.
Activating your physical card
If you prefer using a physical card, you will be able to get one from Neo. However, it may take up to 15 business days to receive it. You can view your card’s expected delivery dates in the Neo app or online. To activate your physical card:
- Log in to the Neo app
- Tap on the Card tab
- Select Activate physical card
- Enter the CVC and the expiry date
You’ll need to insert the card and use your PIN when you make your first pruchase. Your physical card has different expiry and CVC number than your virtual card, for security reasons. This means that you’ll need to update these details on any online payment information you have saved as well as remove and re-add your card to your Google or Apple Wallet.
Neo Prepaid Card and App Review: Where to Find Cashback
The most frustrating thing about the Neo prepaid card is that it is impossible to find a complete list of the various stores you can earn cashback from. In fact, not all locations of a partner offer cashback. This means you have to be careful and double check when you shop at partner stores. A little exploration will lead you to identify some main partners, among which we find:
- Hudson’s Bay
- Frank and Oak
- Sport Check
- The Body Shop
- Boston Pizza
- Five Guys
- and thousands more
Your dashboard can help you find cashback opportunities near you. For example, you can choose between dozens of categories to see the best offers. The offers presented to me were slightly disappointing, such as Second Cup’s and Decathlon’s 4% cashback. In fact, I live in a pretty small town, which limits the stores available, but still. I would have to drive for 30 minutes or more to get there. It seems to me like I would spend all my cashback on gas! Online offers are still interesting when they offer free shipping.
You might want to look out for the minimum buy you have to make in order to get the cashback. In the case of Popeye’s Supplements, you will need to stack them up for a while to reach $175!
On the other hand, the absence of a minimum threshold before your rewards become available to spend or save is appreciated. This way, you can really benefit from your rewards when you need them!
More features to know about
An interesting feature of the Neo app is Auto save and pay. It helps you stay ahead of your bills by setting up automatic transfers and payments. You can also decide what balance stays on your card, ready to spend, and what stays in your account.
If you are worried about fraud, you can lock your card in-app. You are able to freeze your card anytime, and unfreeze it when you want to make a pruchase. You can also set up instant purchase notifications and the app will warn you if someone else is trying to buy stuff using your card.
Neo Prepaid Card Review: Fees and Limits
With the Neo prepaid card, you get a no-fee account. While there are still some small fees you may have to pay here and there, it is true to say that it is mostly free. You can hold and transfer large amounts of money so there shouldn’t be any issue with transfers and bill payments. Your balance can reach $200,000. While traditional banks will punish you with high fees for non-sufficient funds or stopping an e-transfer, Neo understands people make mistakes and has a more forgiving approach.
|Monthly Account Fee
|Send & receive Interac e-Transfer
|$3,000 per outgoing transaction, $10,000 daily/weekly, $20,000 monthly
|$30,000 outbound to linked external bank per transaction; $100,000 inbound per transaction
|Pre-authorized Debit and Bill Pay
|$25,000.00 per payment
|Neo to Neo
|$5,000 per transaction, $10,000 daily, $20,000 weekly, $30,000 monthly
|Stop Interac e-Transfer
|Printed version of monthly statement or other documentation
Depositing Money into your Account
In order to deposit your pay directly into your account, log into the app and:
- Select your Money account
- Select the three dots at the top right corner of the screen
- Select Account Details
- View the details required to set up direct deposit or download your direct deposit form as a PDF document
If it is a deposit from payroll, you will get the money instantly. However, if you are getting paid for contract work, it can take up to 5 business days.
What happens when you make a mobile cheque deposit in your Money account? Neo could place a temporary hold on your deposit to ensure that the funds are indeed accessible from the other financial institution’s account. You will actually see the money your account balance, but you won’t be able to use the deposited amount to make withdrawals, transfers or bill payments until the end of the hold. How long will that be? Neo claims the hold will last up to 5 business days for deposits under $1,500 and 8 business days for equal or higher amounts.
Pros and Cons of the Neo Prepaid Card
Although the Neo prepaid card offers some interesting features, users on TrustPilot and Google are expressing dissatisfaction with various Neo Financial products (mostly credit cards) and customer service. Here’s our summary of pros and cons.
|No minimum balance
|Not made for travellers or multi-currency users
|No monthly or transaction fees
|No paper cheques
|Earn 2.25% interest on your balance
|Not available in Quebec
|Finding good local cashback partners is not easy
|High cashback at partners
|Hard to talk to customer service
Alternatives to the Neo Prepaid Card
Because some people still need to use paper cheques or send money abroad, Neo Money is not the perfect prepaid card for everyone. Here are two alternatives to the Neo prepaid card.
EQ Bank Card – For a Better Interest Rate
Like the Neo Money card, the EQ Bank Card is also free to get and has not monthly charges. You can earn more money on your balance with this card. EQ Bank offers a 2.5% interest rate on your balance. However, you only get 0.5% cash back on your purchases. What makes EQ Bank stands apart is its internal money transfer fee strutcture. In partnership with Wise, you get the real exchange rate (no markups) and pay one small clearly outlined fee for sending a transfer.
KOHO Prepaid Card – For Easier Cashback
The KOHO prepaid Mastercard is also free if you choose the Easy plan. It works in the same way as the Neo Money card and the EQ Bank card. The Easy plan offers 1% cashback on groceries and transportation. It is not huge, but you also earn 0.5% interest on your entire balance. However, you should know that it charges a 1.5% conversion fee for foreign currency transactions.
FAQs about the Neo Prepaid Card
It is one of the best prepaid cards in Canada, and comes with a Neo Money account. You can use it for your daily sending and earn cashback at partner stores. Because it is not a credit card, you do not have to go through a credit check to get it. You can only spend the money you already have in your account.
Yes, Neo Financial offers a prepaid card called Neo Money (account and card). However, Neo is a neobank that also offers standard credit cards (Neo Credit) and secured credit cards (Neo Secured) as well as other products (investments, mortgages).