Zerocard aims to be an alternative to credit cards from big banks. It is a credit card, but provides a `debit-style experience` and 1% to 3% cashback rewards for cardholders. Customers have to have a Zero checking account in order to qualify for the credit card, which allows them to use the debit-style feature.
The debit-style feature can be turned on and off at anytime via the Zero app. When this feature is turned on, the credit limit of a customers Zerocard is equal to the amount in their Zero checking account: a USD 100 checking account balance gives them a USD 100 credit limit. This is similar to a secured card, which typically requires a USD 200 cash deposit that becomes their line of credit.
Zerocard holders also have the option to turn off the debit-style feature and use the card like a traditional credit card. When the debit-style feature is turned off, Zerocard works similar to a charge card with no preset spending limit, though that doesn’t mean unlimited credit (creditworthiness is assessed in real-time).
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