Visa gift cards are like any other business out there, to make money while they are providing a service. So if someone purchases a gift card, for a certain amount, and the recipient receives that amount, how does the service provider make their money to be able to pay for the costs of making the card (minor, yes), processing the card for each gift purchase, and keeping track of the accounting? Well, there are charges, some hidden and some not so hidden that will pay for the costs to provide this service.
Some prepaid visa gift card plans carry a monthly fee, which is usually around $10 per month. The monthly plan includes 2 free ATM withdrawals, a free convenience fee (when you don't use your PIN) and no maintenance fees. This kind of plan is useful if you plan on using the ATM at least twice a month and like to check your balance regularly. All in all, if you plan to use your card a lot, if you can, you should get a bank account, or a credit card and can pay your balance off every month, you would do better with those options.
There is also a pay as you go plan that has no monthly fee. The difference with this plan is that you pay each time you check your balance, and each time you want to withdraw money from your account. You will also get charged a maintenance fee as well if you don't use your card for at least 3 months. This plan is more cost effective if you don't use your card more than once or twice a month.
In either case, using a prepaid Visa card, or any other type of prepaid card for that matter, will have some costs associated with it. These types of cards are really not recommended for those with good credit and have a bank account with their own ATM service feature. If you plan to use your prepaid card regularly, or you get paid by having a balance added to a prepaid account, you will end up paying to access your own money. If someone proposes this payment arrangement, going the PayPal route will be much better solution.
Other lesser known costs associated with the gift cards concern using the card for more than just a cash card or a debit card. If you use your card to pay bills, there is a bill payment fee of $1.00. However, even before you get charged to pay your bills, there is a one time charge of $2 to enroll your card to pay your bills. If you decide that you want to change your plan from the monthly to the pay as you go, or the other way around, you will get charged a 'plan change fee' of about $2. If you want to transfer a balance from your prepaid account to another account, you will be charged a fee of $2.95. Last but not least, if you lose your card, you will get charged a $3.95 fee to replace your card.
Most of these charges don't exist with credit cards or bank accounts, so it is very evident that the use of prepaid visa cards should be used sparingly and if no other option is available, as you get charged for almost any activity that you perform on your card. Find out all you can about the difference between credit cards, debit cards, prepaid visa cards and gift cards before you make your decision on which solution is right for you.
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