New User’s Quick and Comprehensive Guide to Prepaid Cards

Over the years, prepaid cards have become quite massive. In fact, a Pew survey revealed that prepaid card use exploded by as much as 50 percent from 2012 and 2014. Since they were first introduced, prepaid cards have evolved into one of the preferred payment methods especially for those who don’t have access to banks.

In addition, prepaid cards have also become a favourite among millennials. In fact, many see prepaid cards as the consummate alternative to the traditional bank accounts as well as other plastic cards.

How Well Do You Know Your Prepaid Cards?

If you’re like most people, it is likely that you’re considering getting a prepaid card. If you don’t know much about it, here’s your quick and comprehensive guide to one of the best financial tools now available.

What are prepaid cards?

Prepaid cards look almost identical to credit and debit cards. However, unlike the latter, prepaid cards are not linked to any bank account. They also have to be preloaded with money before they can be used. Also, unlike credit cards, you won’t be “borrowing” money from the issuer. Rather, you are using your own money, the one you preloaded in your card. 

Gift cards are also classified as prepaid cards. However, gift cards are designed for one time use only. Reloadable prepaid cards on the other hand are designed for repeated use, given of course that the card has money in it. Fortunately, there are several convenient ways to reload money onto a prepaid card.

How can I use my prepaid cards?

Just like credit and debit cards, prepaid cards can also be used for merchant and online transactions. They are also often affiliated with established credit and financial networks. That means they are also accepted and honoured in establishments associated with the network.

Each time you use your prepaid card, the purchase or withdrawal amount will be deducted directly from the balance that’s available on your card. In other words, your transactions will be limited by the balance that’s available on your card. 

If the amount available in the card is not sufficient to cover a certain purchase, your transaction will be declined. Suffice it to say, prepaid cards can be very beneficial budgeting allies as they won’t allow you to spend more than you can afford to. When used for ATM withdrawals, you’ll need a personal identification number (PIN).

How do prepaid cards differ from credit cards?

While both cards can be used for both ATM and purchase transactions, they have a few distinct differences. Case in point: when you have a prepaid card, you need to reload money onto your card before you can be used. 

It’s the opposite when using a credit card since you don’t need to shell out any of your own money. The issuer will pay for your purchase or withdrawal first and you will pay for the purchase or withdrawal at a later date.

Transactions using a credit card are considered a loan so your credit history as well as your statement balance will be reported to major consumer credit bureaus. Transactions you do using your prepaid card will not be reported.

What do I need to consider when choosing a prepaid card?

Prior to choosing a prepaid card, it is important that you figure out how you will be using it. For example, would you prefer reloading money through reload networks or direct deposits? If for example, you prefer the former, it would be best to pick a reload network that’s easy for you to go to. 

Another important thing you need to look into are the charges and fees. In line with this, you need to also identify the transactions you’ll usually do using the card. Ideally, it would be best to opt for a prepaid card that charges less for transactions you often do.

What are the Peerless Benefits of Using Prepaid Card for Business?

Nowadays, prepaid cards have become the ultimate financial tool for people who don’t have a desirable credit, those who have issues managing their credit cards, or those who want to curb overspending. 

However, apart from making their way into the hearts (and wallets!) of consumers,prepaid cards for business have also found their way in the business world. 

In fact, for many, prepaid cards for business have become the consummate card of choice for those who are looking for exceptional budgeting tools they can use to ensure the smooth operations of their business. 

The Unbeatable Benefits of Using Prepaid Card for Business

Prepaid cards for business users can attest using them provides peerless benefits that are hard to miss. For starters, they are now used to set aside money for supply and logistics, employee meals and fare, travel and emergency funds, and many others.

So what are other reasons that make prepaid cards ideal for business? 

They are easy and straightforward to use. If anything, prepaid cards won’t require much of a learning curve. This is especially true if you’re already using other plastic cards like debit or credit cards. More often than not, they work pretty much the same way except that it’s not tied to any savings or checking account.

They are easy to load money to. Loading money onto your prepaid card is quick and effortless. However, that’s not all. With a prepaid card, you have the luxury to load any amount you wish at anytime you deem convenient. You also have the freedom to decide on the frequency you’ll load money on your card.

They can help businesses still to the budget they’ve set. While a lot of factors can help warrant the success of any business, proper use of resources, including money is one of the things that ranks high on the list. With a prepaid card, adhering to the budget you’ve set has never been easier. Monitoring of transactions is also a breeze.

The Enticing and Peerless Benefits of Using Prepaid Card for Business

Prepaid cards for business provide a lot of unbeatable benefits. Some of the most notable ones include:

● They can help businesses effectively and easily control and regulate their spending. This ability can help ensure businesses stay efficient.

● Loading money on the card is quick, straightforward, and hassle-free.

● Since no credit checks are required to obtain a prepaid card, application is fast and easy.

● Having and using a prepaid card will not have any impact whatsoever on your credit standing. In addition, it will not affect your credit in any negative way.

● No learning curve is needed when using a prepaid card since they work pretty much like the rest of the plastic cards.

● With a prepaid card, monitoring transactions has never been easier. This brings peace of mind as you are able to easily track your spending and stay on top of your finances at all times.

● Prepaid cards are not linked to any checking or savings account. This means prepaid cardholders are spared from paying huge overdraft charges or those exorbitant monthly interests, fees, and other charges.

Prepaid cards can be an exceptional financial tool so businesses can easily segregate business from personal expenses. The ability to keep both expenses separate can help you better manage both personal and business-related funds more effectively.

● Prepaid cards make it very easy to keep tabs on the spending habits and patterns of employees. In addition, with a prepaid card, monitoring expenses and spending limits is very easy. You are also spared from the risk of accumulating mounting debts you might not be able to pay off easily.