Pros: Teaches responsible money management. Visa Debit Card can be used nearly everywhere.
Cons: ATM and inside bank withdrawal fees, but most debit cards have these.
The PayPal Student Account is a great way to dole out allowances, or to teach teens about spending. This account is not a secured card, nor does it do anything towards building your child's credit, but it can help teens or young adults learn how to handle money responsibly.
Although my son is the only one permitted to log into his account, there is much that I can do from my own account so even though I don't control his spending, I can supervise how well he is managing his money. Since it is linked directly to my PayPal account, it is easy to add funds or check purchases that he makes.
To get the card, I logged into my PayPal account and clicked the link to set up a Student Account. Just fill in your child's name, date of birth (must be 13+), email address and a password. Your child will be sent an email, asking them to activate their account. They can also change the password if desired.
When setting up the account, you can choose whether or not to allow your child to send or receive money, make online payments (including automatic payments), transfer money from a bank account, or use their own PayPal Debit Card, or to text you if they need cash. As the parent account, I can also temporarily block spending or receiving money if I feel the need, or I can also make other adjustments to his account. You also have the option to be notified by phone or text if your child spends over a set amount of money, if their balance drops too low, or if they transfer money from a bank account.
Once this account is set up, your child can log in and check his balance and see all transactions at any time. I have access to this information from my account as well. You can also set up transfers (one time or recurring) from your account into theirs, or you can transfer money from their account into yours if desired. Transferring money from a PayPal Account is free though fees apply for funds transferred from a credit card.
Within a couple of weeks after creating my son's account, his PayPal Visa Debit Card arrived in the mail. To activate the card, he had to sign into his account and enter the activation code from the email they sent. It just took a couple of minutes and he had full access to any funds I sent him.
The money can be transferred instantly into his account from mine, and even if I don't have the funds in my PayPal Account, he will receive them right away. It takes about 4 days for the funds to get to my account from the bank, but he doesn't have to wait for them. This works out great because he can call or text and ask for more money if needed. It only takes a minute to log into my account and transfer him money if needed.