Over the years, one plastic card has experienced a tremendous growth explosion—the amazing prepaid cards! In fact, a Pew survey revealed that prepaid card usage has surged by as much as 50 percent. And that’s between 2012 and 2014 alone!
If anything, the best prepaid cards have evolved dramatically since they were first introduced. Nowadays, prepaid cards are considered one of the most trusted and convenient methods of payment. This is especially true among those who don’t have access to banks.
In addition, the best prepaid cards have now been considered by many millennials as the consummate alternative to the conventional bank account. If you’re considering getting a prepaid card but unsure how to pick the best one that will suit all your needs, this article can help!
However, let’s get into the basics first.
What are prepaid cards, really?
If you’re not familiar with their distinction, it’s easy to mistake prepaid cards for the typical credit or debit card. For starters, they share a lot of surface similarities. What sets the best prepaid cards apart from credit or debit cards is they are not connected to any bank account.
Also, unlike credit cards, you get to decide how much money you’ll load into the account. Why is this important? It puts you in total control of your spending! That means when you use your card to pay for purchases, you will be using your own money rather than “borrowing” money from the bank.
If you need help sticking to the budget you’ve set or curbing overspending, a prepaid card is your ultimate ally! Since you won’t be able to use the card without loading money onto it first, you get total control when it comes to the amount you’ll load and spend. That’s a truly helpful feature especially for those who have difficulty controlling their spending.
How can you use your prepaid cards?
Offering unbelievable and peerless ease and convenience, prepaid cards can be used for both merchant and online purchases. More often than not, prepaid cards are affiliated with seasoned payment networks. That means they are also accepted and honoured in places their payment network is associated with.
Each and every time you use your prepaid card, the total amount of your purchase (regardless if it’s through merchants or online), will be deducted directly (and immediately) from the balance that’s available on your card.
In addition, it is also crucial to remember that the amount you can spend will be based on the balance that’s available on the card. In other words, you can easily control spending by limiting your purchases and other transactions on the balance available. If the balance you have in your card is not sufficient to cover your intended transaction, your transaction will be declined.
This might not be common knowledge but prepaid cards can also be used for ATM withdrawals aside from purchase transactions. If you’re going to use your prepaid card for withdrawals, you’re going to need a PIN (personal identification number) to successfully carry out the transaction.
How do you pick the prepaid card that’s best suited for you?
When looking for the ideal prepaid card, it is crucial that you first determine how you are going to use it. Case in point: how do you intend to load your prepaid card? It is going to be through reload networks or direct deposits? If you prefer the former, then it would be wise to opt for a prepaid card with a reload network you can conveniently go to.
Another key aspect to look into is the charges and fees. In line with this, you also need to figure out how you intend to use the card. Of course, it would be wise to opt for a card that charges the most minimal fees available. In addition, ensure that the card you’ll choose charges less especially for transactions you often do.