What Are Prepaid Credit Cards?
Over the past few years prepaid credit cards have grown in popularity across the United Kingdom. The cards themselves look very similar to the standard credit and debit cards, and allow for products to be purchased on them just the same.
The main difference between a pre-paid credit card and a normal credit or debit card is that the prepaid alternative only allows users to spend the balance that has been preloaded onto the card earlier. What this means is that unlike a debit or credit card, a prepaid card won't let you spend more money than what is already on the card, which ultimately prevents you from running into debt as the card doesn't have a credit or overdraft facility.
When you apply for a prepaid credit card you will also receive your own card PIN. Just like normal credit cards, the PIN will enable you to use the card to make purchases in shops, online, over the telephone, along with allowing for cash withdrawals from ATMs.
Loading funds onto the prepaid card is a very simple process which can be done either via a bank transfer, paying in cash at the bank, at the Post Office, or at a Payzone or PayPoint terminal. The exact methods available for loading money onto the cards to vary depending on the prepaid provider, so be sure to keep this in mind when comparing the available prepaid credit cards.
There are many reasons why using a prepaid card is often more beneficial than a standard credit card. Here's a few of the main advantages.
No Risk Of Getting Into Debt
Prepaid cards only allow you to spend the balance that is available on the card. It's impossible for you to spend over the prepaid amount and therefore stops you from any nasty charges and fees unlike regular credit cards.
No Credit Checks
If you're worried about your credit history and have been turned down from other credit card providers, then you'll be pleased to learn that there are no credit checks when applying for a prepaid credit card. So regardless of what your credit report might say about you, your application will still be approved. Some prepaid cards are even designed to help rebuild your credit history!
