T-Mobile enters prepaid card market

Mobile telecommunication firm T-Mobile US Inc. launched itself into the alternative financial services arena with Mobile Money by T-Mobile. The service, which combines a smartphone app with a Visa Inc.-branded, general purpose reloadable prepaid card, is designed to transform "smartphones into personal money managers that can free people from excessive fees they often pay to use their own money," T-Mobile said.

The company cited Bankrate.com's 2013 Checking Survey that said ATM, overdraft and monthly maintenance fees hit record highs in 2013. T-Mobile said Mobile Money helps counter that trend by allowing T-Mobile customers to direct deposit paychecks, remotely deposit checks, make retail purchases, pay bills and withdraw cash from over 42,000 in-network ATMs nationwide without incurring ATM fees.

"Mobile Money can also be a powerful tool for families seeking a better way to budget or to provide money to kids away at college," T-Mobile added.

The company compared the costs of using Mobile Money to what unbanked families generally pay to use check cashing businesses in order to get access to cash. "The typical household using a check casher to cash their paychecks could save about $1,500 per year, and customers tired of getting hit with overdraft fees can switch and save an average of $225 a year," T-Mobile stated.

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