Since they share many superficial similarities, it’s always easy to mistake a prepaid card for other plastic cards like a debit or credit card. If anything, for the most part, they look almost identical. Not only that, they also share many similar features. However, they also have very distinct differences.
For starters, unlike debit cards, prepaid cards are not linked to any bank or savings accounts. However, they can still be used for ATM withdrawals and purchase transactions. Nowadays, they can also be used to pay for airline bookings, car rentals, hotel reservations, and even online purchases.
While many people are already using prepaid cards and are enjoying all the amazing benefits and perks they are offering, many are also not aware of what they really are and what they can truly do. Others are also clueless as to what makes prepaid cards different from all the other plastic cards that are available in the market.
If you want to get to know your prepaid card more, below are some of the essentials you need to keep in mind:
If you have yet to get a prepaid card, it is reassuring to know that getting one is easy and effortless. This means you won’t have to undergo any background or credit checks and you won’t need to submit any personal or financial documents. In other words, getting a prepaid card is both hassle and stress-free.
What’s even more impressive? Your credit history won’t be considered when you get a prepaid card. Prepaid card issuers won’t be checking your credit score or checking your financial history since you won’t be borrowing or using their money. You will be using your own money, the money that you load on your prepaid card.
However, since there is no credit check required and you are not allowed to submit any financial documents, owning and using a prepaid card will not affect your credit standing in any way, shape, or form. This also means that any payment or transactions done using your prepaid card won’t be reported to any credit bureaus.
Many prepaid cardholders, especially those who love to travel overseas are curious if they can use their prepaid cards outside the country. The answer is a resounding yes. However, as a general rule of thumb, it is recommended that they check with the issuer first. This is especially important if you rely primarily on your prepaid card to pay for transactions outside the country.
If you want to use your prepaid card outside the country, it would also be a good idea to inquire about the fees and charges you will incur for transactions you will do. The last thing you want is to get surprise deductions especially since you will be outside the country and you can use all the money on your card.
Depending on the type of prepaid card you have and the policies set by the issuer, you can use your prepaid cards to pay for bills online. It would also be best if you check with your utility companies if they accept payments using your prepaid card. If they do, check with them how you can go about the payment process.
Additionally, it would also be a great idea to check with the prepaid card issuer regarding the fees and charges when you pay your utility bills using your prepaid card. This is important so you won’t have any unwanted surprises along the way and you are able to track the correct balance and charges.