An interesting article in the New York Times examines (reloadable) prepaid cards and their fees. Issuers of these cards tout them as an alternative to bank accounts and credit cards, especially for those who are unable to get either. Prepaid cards, it turns out, have even higher fees than non-reloadable open-loop gift cards. In one example, the MiCash Prepaid Mastercard has the following impressive roster of fees:

$9.95: Activation
$1.75: ATM withdrawl
$1.00: ATM balance inquiry
$0.50: Per purchase
$4.00: Monthly maintenance
$2.00: Inactivity per month after 60 days
$1.00: Call to customer service

The industry claims that these cards are cheaper than checking accounts. Many banks offer low balance checking accounts for less than $10. By contrast, even the cheapest prepaid card averaged over $20 per months in fees.

Here is a recent Consumers Union report on prepaid cards.