Prepaid Credit Cards
What Are Prepaid Credit Cards?
Prepaid is a term that refers to services or purchases that are paid for in advance of actually acquiring them. Examples of prepaid services include gift cards or gift certificates, mobile phone credit or preloaded credit debit cards etc.,
The function of prepaid creditcards, (which are also commonly referred to as a debit cards), is not dis-similar to that of a regular credit card or a debit card. A key feature of these types of prepaid cards is that you pre-load money onto the cards in advance and use it at places where debit cards or prepaid MasterCard or Visas are accepted.
A further differentiating feature of a debit card or a pre-paid creditcard, is that it does not require the parent as a co-signee, provided you are at least 18 years of age.
Benefits Of Prepaid Cards
For a variety of reasons, there are many people, including college students, who do not have bank accounts. As a consequence, credit card credit is not available to them. Even where having a bank account is not an issue, poor credit rating or credit history can be a hinderance.
This is where prepaid debit cards or pre-paid credit cards can offer a solution. Prepaid debit cards are becoming increasingly popular and are being used by many in place of credit cards.
Apart from the fact that these cards are a great financial tool
for both college students and other people who cannot get regular credit card credit, prepaid debit cards offer a safer alternative to carrying cash.
Further benefits offered by prepaid debit cards is the ability to monitor your spending and to budget accordingly. They can
also be less costly in relation to fees, compared to the costs
of maintaining some other types of checking accounts.
How Prepaid Credit/Debit Cards
Prepaid cards are ideal for college students in particular. These debit or students credit cards are in effect visa or or MasterCard accounts. These are obtained by opening a deposit account, into which you or a parent will need to deposit a sum
that will represent the amount you want to have access to. This
sum of money will form the basis of your spending. Quite simply, it is your own money being used, as opposed to you using credit card credit borrowing.
As you spend, it's a simple case of reloading your prepaid student credit card as you use the funds. Hence, a prepaid reloadable credit card is not strictly a credit card but a debit card, although these cards are often referred to as such.
Prepaid reloadable credit cards present no risk to credit card providers, which is why this type of credit card account is usually targeted at other groups of people who have no established credit history, or poor credit rating. For instance, there are cards for teens; for people who have a history of defaulting on credit or people who are immigrants and for low income families etc.,
Selecting The Best Prepaid Credit/Debit Cards
More and more prepaid cards are becoming available - especially in the Uk. These cards are targeting wider audiences and especially the (under 18's) - pre-paid credit cards for teens, prepaid Master Card and prepaid Visa card offers. Both prepaid visa and MasterCards come with Chip & PIN with high limits.
A word of caution though, if you want to select the best prepaid student credit card! Some prepaid student cards or other debit products will vary in terms of fees and charges, so it's important that you check carefully and read the small print relating to the payment/fee terms and conditions on your credit card
You can use one of the online prepaid cost calculator to work out the best pre-paid card product based on your spending habits. These online calculators are useful tools that can help you work out the card fees associated with different prepaid students credit cards just by entering the amount you intend to spend and to top-up each week.
The ideal pre-paid credit card works on the premise of giving you greater flexibility and control over your spending habits;
one that enables you - the cardholder to load the card with funds at easily accessible outlets. You will also want the comfort of knowing that you will avoid any kind of credit card
credit debt because you will only be able to spend the amount you have loaded onto the prepaid card.
Cashplus is an example of one of the best prepaid card - Uk that can meet such need. Available from MasterCard, Cashplus is designed both as a student credit card and a prepaid card for those with poor credit rating. With this prepaid debit card you can re-load it at any selected Cashplus outlets or at Post Offices. As prepaid services go, Cashplus may represent on of the best prepaid credit card - Uk offers.
Making a prepaid credit card application will not require you to undergo any credit checks on applying. You can buy prepaid credit card
online from major credit card providers, including visa prepaid credit cards, prepaid master card. Do also look at other student
credit card providers such as Citibank, J P Morgan and Chase.
Just visit each credit card provider's website then compare prepaid credit card offers being made. You migh find the following credit card company list useful.
Once you've made your prepaid credit card application and you buy prepaid credit card credits at the limit you want to spend up to, it is simply case of re-loading your credit limit as you go. You can do this by telephone, at ATMs, in person or by topping up your prepaid credit card online.
Which Credit Card For Students Should You Choose?
The content on this site is purely for information purposes only and is not intended to replace your seeking professional financial advice.
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