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If you are considering getting yourself a prepaid card, you may be wondering if there is a difference between the various types available. So is a prepaid debit or credit card the same as a normal debit or a credit card?
The answer is that although the terms are used almost interchangeably, there is really only one type of prepaid card.
What is a prepaid card?
A prepaid card is one onto which you can load an amount of money. This money can be loaded as cash at a PayPoint outlet or via a standard bank transfer.
Prepaid cards typically carry a logo such as MasterCard and can be used to pay for purchases at any outlet and withdraw money at ATM's where the logo is displayed.
It can typically be used as you would any other type of card with the following important differences:
l you can only spend what you have decided to load onto it;
l there is no chance of spending more than is loaded to the card;
l it may be called a prepaid credit card but no credit is actually available;
l so it cannot be used to run up debt.
Using a prepaid card
A prepaid debit card could be very useful, therefore, in circumstances where you perhaps wanted the flexibility of being able to use 'plastic' but without the temptation of overspending.
Getting your card
Prepaid cards are typically available without the requirement of a credit check.
This could make them extremely attractive to those who perhaps have had credit troubles in the past and who therefore may find it more difficult to be accepted for a traditional debit or credit card.
The reason for this is simple enough. Because you load your money onto it, there is no credit involved so no credit check is required.
You may even find that there are some debit card suppliers who may also be able to offer online banking facilities to make your life just that little bit easier as you can have (eg.) have your salary paid directly into your account and then load money onto your prepaid card directly from there.
About this Author
Gary Miller-Cheevers is the CEO of Speed-e-card.com, a UK based prepaid debit card provider. The Speed-e-card is like a normal credit or debit card, but with no late fee or interest charges. It is unique in that a speed-e-loans payday loan can be loaded onto the card, once it is activated. Customers also get a free e-bank account, so can use the card as they would a bank account, having their salary loaded on to it and managing bills online. So if you are looking for a prepaid debit card, please visit us.
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