Apply For a Prepaid Credit Card - Five Good Reasons Why

Prepaid Credit Card

For a number of reasons not everyone is in a position (or wants to) to apply for a regular card and that is why they apply for a Prepaid Credit Card. It's pretty hard in today's world to live without a one as they allow you to make payments where cash or a check are not always possible.

What are Prepaid Credit Cards?

PrePaid Cards are unlike regular cards, since no credit is offered by the card issuer: the card-holder spends money which has been "stored" via a prior deposit by the card-holder or someone else, such as a parent or employer. However, it carries a regular card brand (Visa, MasterCard, American Express or Discover) and can be used in similar ways just as though it were a regular card. Simply deposit money into your prepaid card account and away you go!

Five Reasons To Apply for a Prepaid Card

-- Convenience

Pretty much everyone needs a credit card these days and once you have money in your account, you can use a prepaid card anywhere you would use a regular card.

-- Financial Discipline

A lot of people are worried that they may be tempted to run up large debts and unfortunately many people do exactly that. There are no such dangers with a prepaid card. You can only spend up to the amount you have already prepaid on the card.

-- Budgeting for Teenagers

Perhaps your child mainly shops online or would prefer not to carry cash but due to a lack of any credit history they can not apply for a regular card. (And, let's face it you probably wouldn't want them to have one anyway). Paying their allowance (or part of it) onto a prepaid card could be a great answer. And, it can be a great way to teach them basic budgeting. They can also be given as gifts allowing your difficult to please teenager to choose exactly what they want.

-- Budgeting for Students

Students often need credit cards for a variety of reasons. They make it easier to purchase a variety of goods and services and are great to have on hand in case of an emergency. But maybe they're not quite ready for a regular card. A prepaid card is just what they need.

-- People with poor or bad credit

Some people are unable to apply for regular cards because of poor or bad credit thereby denying them the advantages and convenience of a regular card. A prepaid card could be the answer. You'll be able to do all the things you can with a regular card without having to worry about running up further debts.

Importantly, most prepaid cards report to at least one of the major Credit Bureaus allowing you to re-build your credit rating.

Advantages of a Prepaid Card

The best part about a prepaid credit card is that you can use it as much as you want (up to the amount currently deposited on the card) and you won't be in any debt. The money is yours anyway and you can't spend more than your limit without making another deposit and there no charges apart from a small fee to set up the account and make further deposits.

Dave Nichols owns CardsWithRewards a website dedicated to finding the right Credit Card for you! To find out more about Prepaid Cards and view card comparisons visit the site today!

Article Source: http://EzineArticles.com/?expert=Dave_Nichols

Prepaid Credit Card

The Benefits of a Prepaid Credit Card

Prepaid Credit Card

Perhaps the first thing to be said is that a prepaid credit card is something of a misnomer. If something has been prepaid, then it is not strictly speaking, of course, a "credit" transaction. But the name has caught on because prepaid "credit" cards can be used - for most intents and purposes - just like a standard credit card.

The principle behind the prepaid credit card is rather akin to the - now old-fashioned - idea of a book or record token, or a prepaid phone card. In other words, a payment is made in advance against an anticipated future purchase and, provided there are sufficient funds represented by the token or the prepaid card, the transaction can proceed without the need for any cash payment at the time of the purchase.

Prepayment is made by "loading" the card with cash paid in at the Post Office, a bank, a PayPoint or Payzone till. This can be made through an employer, a transfer through a bank, or by using a standard credit card. The prepaid card is then ready to be used in just the same way as a normal credit card would be used.

To complete a purchase, you will need to key in a PIN number at the shop counter and the amount of the transaction is deducted straight away from the balance on the card. The prepaid card can be used in the same way for shopping online.



There are a number of benefits to using a prepaid credit card:

• Perhaps the most important is the control it exercises over spending. Since all purchases are prepaid, it means that you are accumulating no debts through its use and spending is limited to however much has been pre-loaded onto the card:

• It can be a good way of controlling a child's spending, for example, with a monthly statement of how the money has been spent;

• Carrying a pre-paid card is also somewhat more convenient and safer to carry than cash;

• For similar reasons, many such cards are also an ideal alternative to travellers' cheques when travelling abroad. Some providers of prepaid credit cards now also offer currencies such as Euros and US Dollars for easier use when withdrawing the pre-loaded cash abroad. Once again, they are more convenient and probably safer than carrying local currency.

Because prepaid credit cards involve no actual spending on credit, an applicant's credit history or rating is irrelevant to the card-provider, so they will be issued without the usual credit reference checks.

Of course there are charges involved in obtaining and using a prepaid credit card and these are probably the main drawback. Some providers may charge an application fee when the card is first issued and others might charge a monthly subscription fee. There may be fees for loading the card with cash and/or fees for making purchases and withdrawing cash. If the card is lost or stolen, some providers might charge for the issue of a replacement and still other providers might charge a renewal fee when the existing card expires.

When considering just how useful prepaid credit cards might be for you and your family, therefore, it would be important to consider how much you are likely to pay for their use.

Confused.com is one of the UK's biggest and most popular price comparison services. Confused.com helps consumers save money on everything from Credit Cards to Mortgages.

Article Source: http://EzineArticles.com/?expert=Gemma_Stanbury

Prepaid Credit Card