Mark Carolin

Posts Tagged ‘Prepaid Cards’

Large corporations need to keep track of how the executives are spending their money on business expenses. The busy executive does not have time to spend doing a lot of paper work explaining how he is using his allowance on conducting business. The prepaid credit card helps both the corporation and the busy executive because they keep an accounting record and send it to both parties. This has been a great innovation for large corporations who have many people working and needing multiple things. Instead of having to get a purchase order the executive gets a budget based on the type of work they are doing along with the budget they get a Prepaid Credit Card that they can use to maintain business as usual. This saves a lot of time plus it frees the executive to make decisions on some of the transactions that must be made.

Prepaid Credit Cards

Prepaid credit cards usually have a logo from one of the major companies such as MasterCard(TM), Visa(TM) and Discover(TM) which depicts to the merchant that he is protected by the lending institution. This makes it much easier for the user to buy the things he needs and make the reservations that he wants. Now you can create your own card and have your picture placed on the card if you like. Major corporations like for business to know that it is their company s they may have their corporation logo on the card. You can have the card made to your liking while still holding the major holders logo in the bottom corner.

Prepaid credit cards have been around for over ten years now, although they are just now coming into the spotlight. Prepaid credit cards are basically credit cards backed by major credit card companies that offer you the ability to deposit money onto the card and then use it for purchases. You are not allowed to spend anything more than you have deposited in most cases. It is a great way to teach students good financial responsibility. There are a lot of advantages to prepaid credit cards, and only a few disadvantages. However, before committing to any prepaid credit cards, you should be clear on the company’s rules and fees.

No Credit Checks

One great thing about prepaid credit cards is that there is usually no credit check required. This makes prepaid credit cards ideal for those with lousy credit scores or even those without any previous credit to build their credit. If you have bad credit, this is a nice way to slowly rebuild your credit score. Creditors will see the card on your report and see if you use it responsibly and often.

No APR

Many prepaid credit cards offer no APR on money deposited and your purchases. Some do charge high interest rates on your balances however, so beware. There is no reason you should pay a monthly interest rate on money you have deposited or on purchases. Therefore, you should certainly look for cards that offer no APR.

Fees

Just like the bank, some prepaid credit cards charge fees on your transactions. Some prepaid credit cards will charge you ATM fees or cash withdrawal fees. These are the most common fees with prepaid credit cards. Some cards however may try to charge you a monthly usage fee. Try to get a
prepaid credit card that does not charge this monthly fee. They exist out there, so just search. You will save yourself a lot in the long run by avoiding a monthly fee on your prepaid credit cards.

Direct Deposit

Prepaid credit cards often have the ability to allow you to directly deposit your check onto your card. This eliminates the need to go to the bank each week. This is the perfect option for the cardholder that uses their prepaid credit card for everything. Take advantage of these convenient options, as they can save you time. The truth is, prepaid credit cards are responsible ways to spend money. They give you the option
of using your money anywhere credit cards are taken without leaving you with a high monthly bill.

Prepaid credit cards can also offer reward programs and other incentives similar to regular cards. They are convenient and low risk. As with any credit card, make sure your prepaid credit cards have terms which with you agree. It is better to read everything before rather than later.

In the UK consumers can enjoy a very good choice of credit cards, and these days the choice is better than ever, with something to suit everyone. In addition to standard credit cards, where you can enjoy a certain, specified amount of credit and spread repayments, you can now also opt for prepaid credit cards, which may prove useful for certain consumers. Although prepaid credit cards are not yet available from every card issuer, they are becoming increasingly popular in the UK.

Standard cards

With standard credit cards you can use your card to make purchases and cash transactions, and then you can repay what you owe. on the card over a period of time or altogether at the end of the month. If you clear the balance each month you won’t pay any interest, otherwise you will be charged interest on the remaining balance (unless you have an interest free credit card and clear the balance before the interest free period expires).

Pros:

Convenience and flexibility Being able to enjoy a specified credit limit Being able to spread the cost of purchases Enjoying rewards or interest free credit based on type of credit card Being able to avoid interest charged by clearing the balance each month
Cons:

Extortionate interest rate charges on uncleared balances on some cards Possibility of high charges for late repayments or for going over limit Potential to get into high levels of debt Risk of credit card fraud
Prepaid credit cards

With prepaid cards you can enjoy the convenience and ease of making purchases on a card, but you will not actually receive credit. Instead, you have to load the card with cash like a prepaid mobile phone. You can then use the card to make purchases up to the amount that is loaded on to it. This is a very effective way for those with poor credit and who are unable to get a regular credit card or a debit card facility to enjoy the ease and convenience of shopping by card rather than cash and cheque.

Pros:

Convenience and ease of shopping by card No risk of getting into debt No costly charges or interest fees Easy and convenient to load card with money Suitable for those with bad credit
Cons:

Having to have the cash upfront in order to make a purchase No additional benefits and rewards like many credit cards Cannot spread the cost of purchases

Applying for a prepaid gas card may have lesser hassle compared to applying for a gas credit card. However, there are a few considerations that you have to keep in mind before initiating a prepaid gas card application. The following can act as your checklist when considering whether to sign up for a gas card which is prepaid in nature.

Rewards and Prizes

Most people sign up for a prepaid gas card to get free gas. However, companies issuing the gas cards offer some other form of rewards and prizes apart from just free gas. They can be car accessories, gift certificates, household appliances and much more.

If your purpose of signing for the card is to get free gas or cheaper gas, inquire whether the card will offer rewards such as discounted gas, gift certificates for gas purchase or even free gas for your next purchase. Do keep in mind also that loyalty will be rewarded as well. Thus, by holding a prepaid gas card for a longer period, the rewards will become very significant.

Gas Purchase Rebates

Some prepaid gas cards offer on the spot gas rebates, which is equivalent to discounted gas. Different stations and different prepaid gas cards may be offering rebates at different rates. However, there might be a fine print on minimum spending before you can qualify of such rebates.

Terms and Conditions

There are some prepaid gas cards which might have terms and conditions that require your attention prior to application. Some cards have requirements such as minimum monthly spending, commitment fees, application fees and whether the card can be used by anyone else.

Not reading the terms and conditions properly might lead to overspending on gas instead of savings. Also, you risk getting your card canceled if you fail to abide their terms and conditions that you have agreed to.

Normally, when making an application for the usual kind of credit card, you undergo a credit search which will determine your credit limit. Once this transaction is validated by the credit card issuer, you will be able to use your credit card to make your purchases. And as is the custom, you will receive a credit card statement at the end of each month. If you pay off your outstanding balance every month, you will not be charged any interest. But if you fail to pay off the balance, then you’ll be obliged to pay interest on that very balance that has been carried forward to the following month.

But this is not the case with a prepaid Master Card which you load up with money when making an application. The beauty of having a prepaid Master Card is that a credit search is simply waived aside because your prepaid Master Card is already loaded with money. Not only this, but you don’t have to worry about clearing your outstanding balance and you won’t even receive a credit card statement at the end of each month.

Your prepaid Master Card, unlike the humble credit card, will be your magic wand that guarantees acceptance and opens doors at all participating outlets throughout the world. And as its name suggests, the Master Card will make you the master of your spending habits, knowing full well that you cannot go over the prepaid limit unless you top it up with more money.

As it is with a credit card, your prepaid Master Card dispenses with the idea of carrying large amounts of cash on you. And in the event of a theft, you can be rest assured that you are well protected because of your PIN number which no one should have access to.

If you are sold on the idea of acquiring a prepaid Master Card, here’s how you can procure one. You will have to pay an application fee to obtain a prepaid Master Card. Some prepaid Master Cards issuers may charge a monthly fee while some others may charge an annual fee. Each time you use your Master Card on your transactions, you will be levied a handling fee. Your prepaid Master Card can be topped up either online or through your bank. If you don’t have a bank account, then you can always top it up with ready cash, at Post Offices, shops and garages, throughout the UK.

Most people could not live with their credit cards today, using that little piece of plastic for everything from buying groceries to traveling abroad. However, those with less than stellar credit histories may be hard-pressed to find a company that will offer them a revolving line of credit without any collateral attached. This is where prepaid credit cards come into play.

What is a Prepaid Credit Card?

Prepaid credit cards are attached to a checking or savings account. When the card is used to make a purchase, the money comes directly out of the account. The card allows you to continue to charge as long, as there is money in the account. When the balance is gone, the card can no longer be used until cash is deposited into the account once again. Because the card holder is not charging up debt when using the card, there is no interest payment or risk of taking on more debt than you can handle.

Benefits

Prepaid credit cards may be a good choice for someone who is unable to get approved for a standard credit account. Some companies, such as hotels and rental car agencies, require a credit card number to make a reservation. You can use a prepaid card for these purposes without running up debt or paying interest charges on the amount. The card is much easier to get than other types of credit, and you don’t have to worry about the risk of taking on more debt than you can handle and putting yourself in a difficult financial position.

Drawbacks

While prepaid credit cards can be a good option for some, there are some drawbacks to using these for difficult financial situations. First, the funds must be in your checking or savings account in order for you to be able to use the card. This is little help is you are in a tight spot and need a little extra help to make ends meet until the next paycheck. The other problem is that some companies may not accept prepaid cards for payment of monthly expenses because they worry that the money may not be in the account when it comes time to pay the bill.

Alternatives

There are additional options to these credits cards when you are in a financial pinch. An emergency line of credit deposits money directly into your checking account so you can write checks or pay bills without worrying about overdraft or late fees while you wait for the next paycheck to come. These accounts are only used when you need them, and the balances can be paid back in full at any time or in minimum monthly payments for a small finance charge.

The advantage to an emergency line of credit over prepaid cards is that the money you need goes directly into your account. The person or company you write a check to never needs to know that the money came from an emergency fund. This is an excellent choice for covering payments when money is tight.