Starbucks discontinuing prepaid debit rewards card in November

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Starbucks is pulling the plug on its prepaid debit rewards card product.

The cards, which are issued through Chase, stopped accepting new signups earlier this year, but users are getting emails saying the cards will stop working Nov. 13, 2021.

At least some members are being offered 400 bonus stars in emails announcing the decision to shutter the program.

Customers will be able to receive a check or electronic refund on any remaining balance.

This change does not affect the credit card product Starbucks offers, also through Chase — only the prepaid debit card format.

The prepaid debit card option had no annual fee or reload fees and let customers earn two stars for every $1 spent at participating Starbucks stores, as opposed to three stars per $1 with the credit card product, which does have an annual fee.

The debit card also offered one star per $10 spent on most other purchases, whereas the credit card gives one star per $2 spent at qualifying grocery stores, local transit and commuting expenses and internet, cable and phone services and one star per $4 on almost everything else.

Prepaid debit cards are sometimes preferred by consumers because, since you have to load money on it from a source that has available funds, it’s easier to control spending and budget — and avoid racking up thousands of dollars in credit card debt that often comes with the sky high credit limits credit card issuers like to give out.

Debit cards are generally easier to get approved for than credit card products and are often favored by those with lower incomes, poor credit histories or who simply want to avoid opening another line of credit.

Banks and merchants like debit cards and prepaid debit cards because they generally incur lower processing fees and also lets them profit from preloaded unused balances — which can add up quickly when combining even small balances from tens of thousands of customers.

The Chase Starbucks prepaid rewards card required a customer to have a Chase or Liquid account that could be linked to it or it could be funded by with debit card from another bank.