A prepaid cash card is similar to debit or credit card because it enable us to make purchases without cash or checks. The different between prepaid card and credit card is prepaid card no risk of running into debt as it has no credit or overdraft facility. Besides that, prepaid card cannot connected to our bank account like debit card.
We shall be give a Pin number when we purchase a card, and once money has been loaded, it can be spent in the same feature as a debit or credit card for online or telephone purchases, as well as cash withdrawals from ATMs. Money can be credited onto a prepaid card by cash at a bank, Post Office or via a bank transfer.
A prepaid card has a zero balance until money is added to it. While we make a purchase with a prepaid card, the sum is deducted from the balance on the card. When the balance achieves zero, the card is empty and it cannot be used again unless it is a reloadable card which we can add funds and continue using it. Many employers and government agencies employ prepaid cards instead of checks to deliver wages, child support, unemployment and other benefits. Some prepaid cards can have money reloaded on to them so they can continue to be used. On the other hand, prepaid cards such as gift card can be discarded once all of the funds are used up.
There are various types of prepaid cards which available for us. The two major types of prepaid cards are open loop and closed loop cards. Closed loop card is merchant-specific, used for transactions exclusively at a specific merchant's sites. An open loop card is related with and bears the logo of an electronic payment network such as Visa. Open loop card is honored wherever these networks are accepted.
In addition, reloadable prepaid card is one that lets us add funds after our initial purchase, including teen card, travel card and payroll card are reloadable. Teen card allows parents teach teens’ financial responsibility while managing their spending with teen. 
Furthermore, travel card is an alternative to cash and traveler's checks when traveling. Some cards provide lost luggage reimbursement, emergency card replacement and zero liability for lost or stolen cards.
While, payroll card is an alternative to traditional payroll methods in which employees’ wages are deposited directly to their card.
On the other hand, gift card is a non-reloadable prepaid card that can be given as gifts and spent until the balance is zero.
Prepaid cash cards offer many advantages for us. Firstly, there are no credit checks for the card, so we can get a card without worrying about our credit history. In addition, prepaid cards are an ideal way to budget for ourselves. Like a credit card, we can get a full breakdown of spending on the card so we can see what has been purchased, from where and when. With a prepaid card, there is no opportunity of spending too much as we are restricted to the amount we put on our card.
Nowadays, prepaid cash card is recommended for consumer because it is a very convenience tool. It is very useful because it offers several features for us such as purchase products and services. By using it, consumers no need to bring much money and checks when processing a transaction. 
Useful links
0 comments:
Post a Comment