Prepaid Credit Cards


What is a Prepaid Credit Card?  A Prepaid Credit Card (also known as a Top-up Card or a Prepaid Debit Card ) is a plastic card that may be used to obtain cash or make purchases.  Unlike a true Credit Card, when you use a Prepaid Credit Card the amount is immediately charged to your card account and the card can only be used if there are sufficient funds in the account.

With a Prepaid Credit Card you may withdraw funds from your account using an automated teller machine or ATM (often known as a cash point or "hole in the wall". Stores and online suppliers also accept Prepaid Credit Card , treating them the same as cash. A Prepaid Credit Card transaction pays the seller of goods or services by withdrawing funds already on deposit in the buyer's account, as opposed to a Credit Card transaction in which funds are loaned to the buyer by the card issuer.

There are many different Prepaid Credit Cards available - through banks, and dedicated Charge Card companies and other organizations.  There may be an fee charged for possessing a Prepaid Credit Card, but some cards may pay interest on any funds that are not spent within a designated period.  Some companies may waive the fee for good customers.  You may also be charged a fee for using your card to obtain cash from some cash machines.

How a Prepaid Credit Card works.  When a purchase is charged to your card, the seller receives payment from the Prepaid Credit Card company less a percentage of the price - this percentage should not be passed on to customers.  The price is deducted from your account.  Some cards may charge a higher percentage to the sellers than others - although this may not affect the price you pay, it may mean the card is not accepted in as many stores or outlets.

Prepaid Credit Card provide many of the benefits of a Credit Card  or Debit Card without the risk of building up debts or overdrafts through overspending.  They are useful as a means of providing an allowance to young people or as a means of helping to stay within a spending budget.

Able was I ere I saw Elba

Financial Information Services; Banks; Debit Cards; Credit Cards

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