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December 25, 2024, 11:12:24 AM
Funfani.com - Spreading Fun All Over!INFORMATION CLUBInformative ZoneFinancial LiteracyWhat are Prepaid Credit Cards?
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Ryan Martis
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« on: July 11, 2009, 06:21:16 AM »

Many people are rejected after filling out a credit card application because of poor credit. The problem with this is that a major credit card is needed to make reservations for hotels, motels, car rentals and airline flights. Credit cards are also necessary when placing orders online or over the phone. Does this mean a person with bad credit can't do any of these things? Not if that person has a prepaid credit card.

A prepaid credit card account is opened by depositing money into that account, much in the same way you would make a deposit to open a checking or savings account. Once you have money in your account, you're issued a prepaid credit card that can be used anywhere one would use a regular credit card. The best part of the prepaid credit card is that you can charge to your heart's content and you won't be in debt. The money is yours and once it's gone, you can't spend any more until you make another deposit. There are no bills and no interest charges. It's the same principle as using a debit card linked to a savings or checking account.

So what's the catch? First, you'll have to pay a fee to set up your account. The amount varies, but you can probably expect to pay about US$5 to $10 to open a prepaid credit card account. In addition, you'll have to pay additional fees every time you deposit more cash into your prepaid credit card account. For those with bad credit, the benefits of a prepaid credit card far outweigh the risks. They're able to reserve rental cars or hotel rooms, and don't have to worry about credit card bills and interest payments later.

Those who are planning to use the prepaid credit card to pay for a monthly Internet subscription, or to purchase an item where a fixed amount is deducted from their card each month, might be dismayed to learn that this might not be possible. Many of these businesses don't want to do business with a prepaid credit card because there's always the risk that there won't be any money in the account when it comes time to pay the bill.

If you're frustrated because a credit card is necessary to get by in today's world, but can't apply for one because of bad credit, you might consider a prepaid credit card. You'll have most of the advantages of a credit card, and you won't have to worry about interest charges. Sounds like a prepaid credit card is a pretty good deal.

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Ryan Martis
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« Reply #1 on: July 11, 2009, 06:21:58 AM »

Prepaid Visa Credit Card is the best alternative to cash and cheques. It is actually a "Credit Card Without Debt". Prepaid Visa Credit Card is powered by the customer's own money and whatever amount of funds is loaded to the card; is the amount available to spend. So, there is no risk of running into debt.

Benefits of Prepaid Visa Credit Card

* Holders of Prepaid Visa Credit Card are not required to carry hard cash. They can make purchases with the Prepaid Visa Credit Card. Cardholders also enjoy anytime access to cash through ATMs.

* Using Prepaid Visa Credit Card is quite safe as the purchases at the merchant location by the Prepaid Visa Credit Card is protected by Cardholder's signature and access to cash at ATMs is protected by PIN.

* For having a Prepaid Visa Credit Card no Bank Account is required. So, for the people who don't have a Credit History or a Bank Account, Prepaid Visa Credit Card is the only convenient alternative to carrying cash.

* Prepaid Visa Credit Card helps people in controlling their Financial Budget more efficiently. This happens because the Spending Ability of the cardholder is limited by the amount of funds that has been loaded to the Prepaid Visa Credit Card.

* Prepaid Visa Credit Cardholders get Itemized Statements for the transactions done using the Prepaid Visa Credit Card. They can also check the transaction details online. So, as a result they can track and monitor their card expenses and can control the spending as per requirement.

* Holders of Prepaid Visa Credit Card can purchase groceries, fuel and all other necessary things which are required on a daily basis.

* Cardholders can also make online payments and payments over phone using Prepaid Visa Credit Card.

* Prepaid Visa Credit Cardholders get protection against unauthorized usage of the card in case the card is lost or stolen.
Card Replacement Facility is available in case of Card Loss or Card Theft.

All these benefits are can be enjoyed at the cost of different types of fees associated with Prepaid Visa Credit Card. The charges that a Prepaid Visa Credit Cardholder is required to pay are:

* Card Application Fee
* Monthly Service Charge
* Card Replacement Fee
* Card Renewal Fee
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