Prepaid Cards: Your Fast and Comprehensive Guide

If you are like many people, it is very likely that you are looking for new and effective ways to manage your money accordingly and curb overspending. Fortunately, there is now an innovative financial solution that can help you achieve both objectives. All you need to do is get your hands on the best prepaid cards available.

Nowadays, more and more people are enjoying the exciting and peerless benefits only the best prepaid cards can offer. In fact, many are now using it to supplement or totally replace conventional banking services and tools.

Essentially, prepaid cards work pretty much like credit cards when used for purchase transactions. However, there is one distinct difference—instead of borrowing money from the bank (which is what transpires when a credit card is used), users will be spending their own money.

Otherwise known as pay-as-you-go cards, prepaid cards are deemed useless when there is no money available. In other words, unless there is a balance on the card, it can’t be used for any transactions.

However, once money has been loaded on the card, it can be used for purchase and ATM transactions immediately. Users also have the option to load money onto the card whenever they deem fit and whenever it’s convenient for them.

If you are considering getting a prepaid card but not sure if it’s the best option for you, read on to find out!

Prepaid Cards in a Nutshell

Prepaid cards are almost identical to the typical debit and credit cards in terms of look and feel. For starters, the ingenious prepaid card also has a magnetic stripe just like most plastic cards. Other prepaid cards also come with a smart chip for additional security.

When used for purchase transactions, they are used similar to credit and debit cards: the card is swiped when used at retailers and merchant stores and the card number is typed in when used for online transactions.

As mentioned earlier, money needs to be loaded onto the card first before it can be used for any transactions. Depending on the prepaid card you are using, you have several options available as far as loading money onto the card is concerned.

Some of the most common loading options include:

  • Direct deposits to the card
  • Loading cards at retail stores/shopping outlets
  • Transferring money from the bank account
  • Loading money through a secure login portal

Once money has been loaded onto the card, it can be used for purchase and ATM withdrawals right away. One thing to remember when it comes to prepaid cards is that while they share surface similarities with other plastic cards, they actually have different  and unique features.

Also, when using prepaid cards, you won’t get to spend money that is not there. That means when there is no money available on the card, you won’t be able to use it for the time being or until such time when money has been loaded onto it.

Prepaid cards will also require cardholders to deposit money upfront so it is prefunded. Fortunately, unlike debit cards, you won’t need a bank account to be able to use the card.



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