Know the Pros and Cons Before You Purchase Prepaid Credit Cards
Nowadays, more and more people have decided to purchase prepaid credit cards. Why? Well, this is said to be mainly because of the fact that traditional charge cards have come to be known as financial risky entities—having the capacity to cause people to get into serious debt. Prepaid cards have come to be known as the "secured" charge cards which are able to compel their owners to be more financially aware and responsible. But, how do prepaid cards do this?
The Basics of Prepaid Cards
Prepaid cards are basically financial entities which you can use in place of cash to purchase goods or pay for services—in short, they belong to the family of what we call as "plastic money." Although these cards are usually categorized under credit cards, they do not really involve a "credit scheme" or a "spend now, pay later" arrangement. As a matter of fact, their mechanism is the exact opposite of the aforementioned scheme; much like a "pay now, spend later" scheme. Prepaid card holders are required to load their cards with cash first before they can actually use them. A bit confused?
Let me elaborate. With prepaid cards, you, as a card owner have to deposit cash into your card's account. And the amount of money that you have deposited will exactly be the same amount of money you can spend using your card. Once, your card's balance reaches zero, there is really no way you can use it until you reload. This may seem somewhat restricting; but this is quite helpful to a lot of people who have experienced the consequences of having the liberty to overspend with their charge cards. So aside from the benefits already mentioned, what are the main reasons why people get prepaid cards?
The Pros – Why You May Want to Purchase Prepaid Credit Cards
1. They are safer and more convenient to carry around than cash.
2. They can be used for transactions online—booking hotels, plane tickets or online shopping.
3. They are easy to obtain and do not require meticulous credit checks.
4. They are not attached with the possibility of paying for overdraft or interest fees.
5. Some cards may be used to build or re-build credit history.
The Cons – Why You May Not Want to Purchase Prepaid Credit Cards
1. Not all transactions can be paid for with them--like monthly subscriptions wherein a certain amount is to be deducted to the card per month.
2. Their buying capacity is limited—you can only spend the exact amount that you have put in them.
If want to enjoy the convenience of having a charge card but do not want all the financial risks that traditional credit cards pose; or have troubles being approved for one, then prepaid cards are your best alternative. It would be wise to purchase prepaid credit cards if you want to enjoy both convenience and financial security. Click here to apply and get instant approval for a prepaid credit card!
The Basics of Prepaid Cards
Prepaid cards are basically financial entities which you can use in place of cash to purchase goods or pay for services—in short, they belong to the family of what we call as "plastic money." Although these cards are usually categorized under credit cards, they do not really involve a "credit scheme" or a "spend now, pay later" arrangement. As a matter of fact, their mechanism is the exact opposite of the aforementioned scheme; much like a "pay now, spend later" scheme. Prepaid card holders are required to load their cards with cash first before they can actually use them. A bit confused?
Let me elaborate. With prepaid cards, you, as a card owner have to deposit cash into your card's account. And the amount of money that you have deposited will exactly be the same amount of money you can spend using your card. Once, your card's balance reaches zero, there is really no way you can use it until you reload. This may seem somewhat restricting; but this is quite helpful to a lot of people who have experienced the consequences of having the liberty to overspend with their charge cards. So aside from the benefits already mentioned, what are the main reasons why people get prepaid cards?
The Pros – Why You May Want to Purchase Prepaid Credit Cards
1. They are safer and more convenient to carry around than cash.
2. They can be used for transactions online—booking hotels, plane tickets or online shopping.
3. They are easy to obtain and do not require meticulous credit checks.
4. They are not attached with the possibility of paying for overdraft or interest fees.
5. Some cards may be used to build or re-build credit history.
The Cons – Why You May Not Want to Purchase Prepaid Credit Cards
1. Not all transactions can be paid for with them--like monthly subscriptions wherein a certain amount is to be deducted to the card per month.
2. Their buying capacity is limited—you can only spend the exact amount that you have put in them.
If want to enjoy the convenience of having a charge card but do not want all the financial risks that traditional credit cards pose; or have troubles being approved for one, then prepaid cards are your best alternative. It would be wise to purchase prepaid credit cards if you want to enjoy both convenience and financial security. Click here to apply and get instant approval for a prepaid credit card!