Online banking: ibankUP, A Review of a New Online Banking Option from Plastyc for Gen Y

Online banking got a new player this week, with Plastyc announcing a new online banking option directed towards Gen Y.  See this news release from the CEO, Patrice Peyret.

Plastyc, a privately held company and provider of pre-paid Visa cards, has added an online banking option for teens (with a parent’s permission) and for young adults who don’t need all the services of a full-service bank, but need more financial options than just a pre-paid Visa.  According to the website a new account can be set up in 5 minutes, with only a social security number required-no other bank account, or other credit info needed.

See this page for a summary from the ibankUp website on a comparison of various fees to traditional banking.

What are the benefits of such a service:

• Lower monthly fees
• No overdraft fees-you can’t overdraft, because the system will not let you spend more than is in your account.
• Balances are always accurate, since you access the site for checks-no paper allowed, and the card use is immediately reflected electronically.
• Your money can be deposited by direct deposit, credit card transfer or the use of the Green Dot MoneyPak sytem already available at many popular retailers such as Wal-Mart, K-Mart, Rite-Aid and CVS, just to name a few.
• They do allow a system for cash rewards, if you shop at their ibankUpside mall.
• You can access your  balances free online, smartphone, and by a cool facebook widget, and for a small fee at most ATM’s

What are the downsides:

• Only your first online check is free, after that they are two bucks each.
• Although the site promotes itself as a way to teach about/limit overspending, it still means using plastic to pay for things-which some studies suggest leads to overspending.

So, what do I think about this new e banking option?  Anything that limits overdraft fees, and limits costs, while at the same time improves visibility and immediate feedback, I think is a plus.  To think that the world will ever go back to cash only is naive even if spending may be a little higher without that pulling of green stuff out of your pocket.

But more importantly, what do you think?  Love to hear your feedback on this new option of online banking for the gen-y consumers.

Tags: Online banking, pre-paid debit cards

This entry was posted on Wednesday, October 14th, 2009 at 6:20 pm and is filed under credit cards, personal finance, Planned spending aka budget. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.