Nowadays, more and more people are using plastic cards to pay for merchant and online purchases. Fortunately, consumers now have several options available at their disposal—debit, credit, and the best prepaid cards, to name a few.
However, while plastic cards have become almost the norm as a payment mode, not many people really know it inside and out, even its most avid users. This is especially true with the best prepaid cards since they’re technically the latest addition to the plastic card family.
Prepaid versus Credit versus Debit Cards
Confusing one plastic card over another is not really surprising. After all, all plastic cards share several identical features as well as surface similarities. If you examine the cards better however, you’ll realise they have major differences that sets them apart from each other.
Case in point: debit cards allow their users to get money to pay for purchases directly from the balance available on the checking or savings account where the card is linked. Credit cards on the other hand allow users to “borrow” money from the issuer to pay for purchases at a later date.
Prepaid cards on the other hand will require cardholders to load money onto the card first before it can be used for purchase transactions or ATM withdrawals. In other words, the transactions a prepaid cardholder can do will depend solely on the balance available on the card.
If you are looking to curb overspending, the prepaid card is one financial tool you’ll surely love. Come to think of it, once the balance on the card has been depleted, it is deemed useless until you successfully load money onto it again. Also, with a prepaid card, you don’t get to spend money you don’t have or more than you can actually afford to.
Top Reasons Consumers Love Prepaid Cards
If you are like most financially responsible people, mounting credit card debt is the last thing you want. However, if you really need help managing your money accordingly, a prepaid card can be your most helpful ally. Given that you’ve picked the best prepaid card for your needs and lifestyle, it’s easier for you to keep your spending in check.
If you are considering getting a prepaid card, below are some of the benefits you stand to enjoy:
Zero credit checks
If you’ve applied for a credit or debit card, you know how time-consuming and stressful the application process can be. Oftentimes, you’ll be required to submit financial documents as well as confidential information. However, that’s not all! Your credit standing will also be looked into.
Have you made financial mistakes in the past like not paying credit card bills on time or issuing bouncing checks? If yes, then expect your chances of getting a credit or debit card to go down the drain.
Fortunately, obtaining a prepaid card is both easy and straightforward. No financial documents or confidential information to submit. More than anything else, no financial mistakes that you’ve made in the past can hinder you from getting one.
Online shopping tool
If you’re a big fan of shopping online (who aren’t?), you should never be without a prepaid card. Just like credit and debit cards, they can be used to pay for items you’ll purchase online.
All you need to do is browse through the websites, pick the items you want, and pay for your purchases using your prepaid card. Everything is done in a matter of minutes, all while in the comfort of your own home or office.
As mentioned earlier, prepaid cards can be a good financial tool to have when you need to get your spending in check. Since you are limited by the balance that’s available on your card, your spending stops immediately soon as the balance becomes insufficient to cover for a transaction or if the balance has been depleted completely. The good news is you can always use your prepaid card immediately after you have successfully loaded money onto your prepaid card again.