What are the Benefits of Prepaid Credit Cards?
Prepaid credit cards have become all the rage lately as these cards provide a valuable financial transaction service that many people have long since needed. Essentially, prepaid credit cards are not credit cards at all because they do not extend credit. That service is the ability to use a debit card wherever credit cards are accepted. Instead of advancing credit charges one draws from a finite amount of deposited cash. Now, some may consider this a somewhat unnecessary service, but when one examines the benefits of prepaid credit cards it becomes obvious that these cards have a great deal to offer.
For starters, prepaid credit cards are a great way to protect oneself from fraud. While we would all like to assume that the world is made up of honest people, it is not. As such, there have been a great number of instances where people have been defrauded of their credit card funds. This happens often online as a number of less than reputable sellers operating out of seemingly unknown locations in the world rip people off for their credit card information. Considering the following common scenario: a person finds a website selling used books and makes a purchase using credit card information and when the credit card statement arrives it is discovered that the $5 book purchase led to $2,000 of purchases with the provided (and compromised) credit card information. Now, a prepaid credit card would be quite beneficial in this instance or in any instance where one is purchasing from an unknown vendor. For example, one could keep a very minimal amount on the prepaid card (say $20) so that if it is compromised the losses will be minimal and the card can simply be discarded.
Also, these prepaid credit cards are the same as using cash to pay for items without having to carry cash around. This can provide a safety net so to speak if the card is lost or stolen. For example, if you record the account number of the prepaid card and the card ends up being lost you could quickly transfer the balance of the card to another account. This way, no money is lost. Now, if a wallet full of cash was lost then…oh well…it is gone forever. As such, the ability to replace cash with an alternate means of payment is always a huge positive particularly one that also has a threshold limit of spending much lower than a credit card as a lost credit card can prove even more calamitous than lost cash.
Another aspect of prepaid credit cards that is supremely beneficial is the fact that these cards are based on a finite amount of money as opposed to advancing money on a borrowed basis. For some, there is a lack of desire to amass credit card debt, but the need for a credit card in the modern world is generally unavoidable. Additionally, there will be those individuals who would like a credit card but for a number or reasons they are turned down due to bad credit, lack of credit, etc. In regards to these problems, these prepaid credit cards come in handy as they provide a solution to such a dilemma.
As one can see, prepaid credit cards have a host of benefits that speak volumes for the value of these cards. So, if worries about lost or stolen cash or credit cards, overextending oneself on credit or simply wanted to avoid the complexities of applying for a credit card, prepaid credit cards provide a simple, safe and sane solution. What better of an endorsement could one ask for than that?
Watch the video related to prepaid credit card
A secured credit card helps to build credit by allowing the card holder to provide cash collateral to the bank while making payments on time. After a set period of time, a secured credit card will turn into an unsecured credit card. Find out how credit reporting agencies see secured credit cards as an effort towards building better credit withinformation from a financial adviser in this free video on credit cards. Expert: Matthew McKillen Contact: www.innovativefg.com Bio: Matthew McKillen …
Help answer the question about prepaid credit card
Can I Buy Things Online Using A Prepaid Credit Card?Ok well I am 16 and my parents won't let me have a credit card. And I really wanted to buy these glasses from an online store. I bought the prepaid card today, can I use this card to pay for my glasses? It says VISA is accepted but I'm not sure if prepaid will work. My parents have to call VISA to finish activation since I am a minor. But will it work? Thanks!
Yay! Thanks Guys!
September 18th, 2009 at 1:03 pm
Well to answer you questions, yes you do have to be the age of 18. Most people that use prepaid credit cards have bad credit and are not able to get a credit card. The prepaid credit card helps them reestablish there credit. Weather you use a credit card or a prepaid card the credit burial gives you credit points for each transaction. So most people using prepaid credit cards are trying to regain the trust of the credit burial so that they can reestablish there credit and get a real credit card. On the other hand some people may get a prepaid card even though there credit is good, the reason being they would rather pay up front then get into dept. The mistake most people make win they turn 18, is get into credit card dept. For the fact is just about any bank will give a 18 year old trying to establish credit a credit card and imaging Opaline for 8 credit cards and receiving 8 credit cards at a limit of 500$ each. then imaging maxing them out. That would put you in dept 4000$ and not to men-chain the high interest rate 20 percent a month, that is an extra 800$ added to your tab every month. Then if you cant pay, you will never have the credit to buy the house or car you want. That's some thing to think about when you are the age of 18. The responsible thing to do would be to get one credit card and pay off the balince to 0$ every month and that way your not paying the bank intrest. And at the same time you are protecting your on intrest.
September 18th, 2009 at 1:06 pm
Many payroll companies offer debit cards as a means of having a savings account and/or for their kid in college. It also protects the employees monies from girlfriends and the wife.
Maybe you should try contacting Paychex, Inc. or Advanced Data Processing (ADP) and see if they will work with you to sell their debit cards?
Best of luck.
September 18th, 2009 at 1:13 pm
Prepaid credit cards are becoming increasingly popular amongst consumer to improve financial discipline and credit history. Though, a prepaid card doesn't come a with late penalty because there are no repayments to be made, but there are various other fees associated with them, which increase the ownership costs. Having a good knowledge about these fees helps the consumer make an informed decision. Listed below are some important fees levied on prepaid cards.
Annual Fees
Charged by the prepaid card issuing company for usage of the prepaid card on an annual basis.
Monthly fees
Charge by the prepaid card issuing company for usage of the prepaid card on monthly basis.
Customer Service fees
Charged by the prepaid card company for providing initial customer service to issue the prepaid card.
Activation Fees
This fees is charged by the prepaid card issuing company for activating the prepaid card
Fees per purchase
Every purchase done by your prepaid card can attract a fee per purchase. Some prepaid card companies levy this fees to increase their revenue.
ATM Cash withdrawal fees
Whenever you withdraw money from ATM's prepaid card company slaps ATM cash withdrawal fees to your account. Read more from: http://www.credit-card-gallery.com/prepaid_credit_card.html
September 18th, 2009 at 5:05 pm
Reloadable debit cards can have fees attached to them, like a monthly maintenance fee, load fee, etc. A debit card is linked to your checking account. You can only use the money in your account, unless you have overdraft protection. My bank doesn't charge monthly fees or deposit fees, so I prefer my debit card.
September 18th, 2009 at 12:14 pm
What if you do not have a credit record, because you have never had a credit card – should you start with a secured card? Thank you for the information!
September 19th, 2009 at 5:54 am
go to your bank and apply for a secured credit card, The limit is a minimum of $300 or more depending on how much you want to deposit in it. In a year, IF you have paid your card in a timely manner the bank can release you your deposit and make your card a unsecured card with a higher limit.
September 19th, 2009 at 4:37 pm
none at all for credit just cost you more funds.
September 20th, 2009 at 10:00 am
Prepaid debit cards and pre-paid credit cards can help you control your spending. A reloadable debit card allows you to only spend up to the amount you have pre-deposited into the account. If you tend to overspend or like to control your spending, then a pre-paid debit card could be a good choice for you. Also, if you have bad credit and can't get an unsecured credit card, a prepaid debit card is also a good choice. To apply or learn more, you may go here: http://www.creditcarda-z.com/prepaid.asp
September 20th, 2009 at 7:40 pm
Visa is what other nations take, so if you want to place an order overseas sometime that might be your best option.
I have a credit card in my name that my mom keeps for some reason. I've used it once or twice for Amazon books, and otherwise I've not bothered with it.
I have enough hospital bills, and future student loan bills, I don't want to owe on credit cards also. I pay everything in cash.
Chrys knows what she is talking about.
September 21st, 2009 at 1:19 am
You can get a VISA card at Walmart and put as much money on it as you like (with cash). You don't need any credit or even a checking account. This card will work anywhere that VISA is accepted.