Why to Use a Prepaid Debit Card Instead of a Credit Card?

During the 1990′s due to the great losses credit card companies had to look at a different ways of securing their debts. At that time they found a new way of secured credit card and following close behind came the prepaid debit card. Prepaid debit cards are now issued by most credit card companies, such as Visa, American Express and MasterCard.

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The functional procedure of this card is that, funds are added to a prepaid debit card at a retail location or through an online bank. This card works almost similar to a prepaid phone card. Actually, a prepaid debit card is cash that has been applied to a plastic card, this is done so that the funds can be accessed electronically. A limit is assigned to this card that is identical to the amount deposited for that card. Each time you use the card, the amount on the prepaid debit card reduces until the funds becomes zero.

Prepaid cards contain a wide range of benefits. They are very much safer for consumers to carry than cash and they can be used in all countries of the world, it depends that from which company you chose to obtain a prepaid debit card. MasterCard, American Express, Visa all offer these cards, as do some banks.

There are other benefits also like you don’t have to worry about a monthly credit card bill or debt. Any person who reaches the age of eighteen can carry a prepaid debit card, their credit history doesn’t matters.

Even those are eligible to access a prepaid debit card that has extremely poor credit because they must have to have funds before the card is issued.

Another advantage of prepaid debit cards is that they can easily be re-loaded by phone or online as long as there are funds available. This allows the user to have an easy access to electronic funds when on vacation and during business travel. Nowadays many companies prefer to use prepaid debit cards in place of expense accounts or company credit cards.

It is due to the reason that with any other type of card the fees can be astronomical. The card companies charge fees for getting the card, re-loading it, for going over the limit, cashing out the card and canceling it if you should decide to do so. So those cards having the lesser fees are the best to use, so search around to see which companies are offering the best deals so that you may get the cards with lowest fees.

The average cost for re-loading a prepaid debit card is around $5.00, so be sure that you have added enough funds to cut down on repeat re-loading.
You can access funds from prepaid debit cards only with your PIN number. Make sure that you  change it often and never disclose your PIN number to anyone. The best way is that if you have your bank or the company where you obtain the card to put a daily maximum on it in case your card is ever stolen or in the rare instance that someone is able to obtain your PIN number.

The most important thing to take under consideration is that the advantages of prepaid debit cards far outweigh the disadvantages; they are good for everyone, especially for those who cannot fulfill the criteria to obtain credit cards due to their poor credit history. But don’t forget one thing that, prepaid debit cards also have to be used responsibly, just as any other card. You can easily load them time after time until your bank funds are reduced to none. Make it sure that you are keeping the records of your purchases to prevent this type of catastrophe.

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5 Responses to “Why to Use a Prepaid Debit Card Instead of a Credit Card?”

  1. [...] Why to Use a Prepaid Debit Card Instead of a Credit Card Loan Prepaid debit cards are now issued by most credit card companies, such as Visa. [...]

  2. [...] Why to Use a Prepaid Debit Card Instead of a Credit Card? Loan Prepaid debit cards are now issued by most credit card companies, such as Visa, American Express and MasterCard.This card works almost similar to a prepaid phone card. [...]

  3. [...] Why to Use a Prepaid Debit Card Instead of a Credit Card Loan You can access funds from prepaid debit cards only with your PIN number. Make sure that you change it often and never disclose your PIN number to anyone. [...]

  4. [...] Why to Use a Prepaid Debit Card Instead of a Credit Card Even those are eligible to access a prepaid debit card that has extremely poor credit because they must have to have funds before the card is issued. [...]

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