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KOHO vs Stack: Which prepaid card is right for you?

Prepaid cards can help you avoid many common banking and credit card fees.

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Stack and KOHO are Canadian fintech companies. Both offer an app and a prepaid credit card and advertise themselves as a way to reduce the fees associated with banking. Stack partners with Mastercard while KOHO has partnered with Visa.

KOHO and Stack: At a glance

KOHOStack
Founded20172018
People using100,000Not publicly available
HeadquartersTorontoToronto

How the companies work

Both KOHO and Stack offer a prepaid credit card. You can load money onto these cards via a bank account or directly from your employer. These are not real credit cards because you can only spend the money you load onto them. So in that sense, you are not receiving any credit to make purchases. These cards don’t cost anything to use, contrasting with banks that charge annual account fees or fees per transaction, and credit card companies that charge annual fees and high levels of interest on outstanding balances.

Features of each company

StackKOHO
Annual feesNoneNone
Foreign currency feesNoneA percentage of the amount
Cash backVaries by brandGuaranteed minimum with each purchase
DiscountsVaries by brandNone
Round-upsYesYes
ATM withdrawals*YesYes
ReferralsYou get a specified cash bonus when you refer a friendBoth you and your friend get a percentage cashback for set period of time following the referral

*You may have to pay out-of-network ATM fees with each card depending on what machine you use to withdraw cash.

Fees

It doesn’t cost anything to open an account with KOHO or Stack. You can load up to a maximum of $20,000 on both the KOHO and Stack cards and perform as many transactions as you want at a $0 cost. Stack charge a 0% fee for transactions in foreign currency, while KOHO charges 1.5%. Both companies allow you to use their cards at ATMs to withdraw money, though you may have to pay out-of-network fees depending on which terminals you use.

Round-ups

Both KOHO and Stack allow you to set savings goals and fund them by rounding up your purchases by a pre-set amount. For example, if you choose a $2 round-up amount, then a $1.80 cup of coffee will get rounded up to a $4.00 purchase, with $2.20 going toward your savings goal.

Customer support and technology

Both companies offer apps that track and analyze your spending habits. Both KOHO and Stack say that it takes only minutes to sign up and requires providing basic personal and financial information so they can confirm your identity. You use these apps to load money onto your prepaid cards. Stack has a real-time chat option on its website while KOHO has a chat function in-app that promises to get back to you within 24 hours.

So can I get rid of my bank account and use Stack or KOHO?

That really depends on your personal situation. There are ways to avoid bank and credit card fees without signing up for KOHO or Stack. For example, some banks waive annual fees and transaction charges for chequing accounts if you maintain a minimum balance. And it’s possible to get no-fee credit cards that come with only a few frills. Neither KOHO nor Stack offer RRSP, RESP or TFSA accounts, which can be important to a long-term savings plan. KOHO does plan to launch a high-interest savings account in 2020. KOHO lets you pay some bills and make electronic transfers with your account, but Stack is more limited in this area.

There is also the issue of time: using KOHO and Stack means introducing another app and another card into your life. You must also make sure you manage your balance by loading your prepaid card.

Bottom line

Stack and KOHO are very similar companies with essentially the same selling point: avoiding bank and credit card fees.

There are some small differences that might make one card more attractive than the other, depending on your personal situation. If you travel a lot then Stack might be a better fit, as it charges a 0% fee for foreign currency transactions. KOHO charges a relatively low 1.5% fee for all such transactions. Stack offers a combination of discounts and cash back with purchases at various partner brands, while KOHO offers 0.5% cash back rewards with every eligible purchase, and up to 5% cash back with select merchants. KOHO offers a few more of the features common to a bank, such as the ability to pay bills and send electronic transfers.

Want to learn more about prepaid cards? Head to our guide.

Frequently asked questions: KOHO vs Stack

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