The prepaid debit card is a plastic card to make payments much like credit cards or standard debit cards but you have to pre-load the money onto it. These are highly useful for making bill payments, online shopping or daily purchases but without fear of over expanding. These two have a unique identification number associated with the account holder. Issuing off these cards doesn’t need the issuing agency to inquire into the credit history; therefore, these are highly useful to those having bad credit. As the prepaid cards don’t enable users to draw the funds on credit facility, so, the cards can’t be overdrawn.
Are You Still Not Using Prepaid Debit Card?
If you are not using the prepaid debit card and rely more upon the credit card, you are missing something great. Getting it is an easy application, activation, funds loading, funds usage are just the four processes to have a seamless experience of plastic money. The funds can be loaded through bank transfer or credit/debit card. It is safe because the user set the PIN and can change the PIN anytime. This card is accepted at all the MasterCard or Visa network points. Prepaid cards also come with an expiry date; after that, you y get the new card automatically or at a very nominal fee. It is equally good for one and all including children, individuals having a low credit score, new resident individuals, overseas insecurity-concerned concerned shopper etc. It can be used as an alternative to a bank account. It is widely available. It is widely accepted. It is a great help to build credit rank or to improve bad credit score for getting a better priced personal loan. The cap overspending is the most experienced limitation but the same limitation helps you improve finances.
The Benefits of Using Prepaid Debit Card:
London based Retail Banking Research forecasts that a number of prepaid cards will rise 28% worldwide by the end of 2021. Almost 20% of the total payment in Europe is made through prepaid cards. In 2017, UK and Ireland paid almost $15 billion benefits to prepaid cards users. As the prepaid debit cards are free or cost very less, you can have different cards for family members with limited freedom to spend with additional freedom from giving cash to each member. Even some prepaid cards offer interest rate also on the balance amount.
- Bank account functionality
- Credit building
- Peer to peer funds exchange
- Suitable for Younger persons
- Fixed rate for foreign currency exchange
- Cash back facility
How Can A Prepaid Debit Card Help You Improve Finances
- Loading money on to a card offers a safe alternative to cash-carrying in addition. In addition, it controls the impulse for spending that is often not necessary. Even if you are making online purchases and the prepaid card has a low balance, the required balance can be loaded immediately through multiple means even through internet banking. Using prepaid debit card is the best working trick to improve the finances. The best strategy is to plan a realistic monthly budget and load the required amount on to the prepaid card.
- The use of a prepaid debit card kills the temptation many times a month; otherwise, you would spend a lot even without having funds. The use of certified cards often drives you in debts because you never limit the expenses due to the overdrawing facility.
- With a prepaid card, the user holds the funds. The user can check the balance and can track the purchases made without hassles. It frees you from paying the fee for checking account periodically as the regular banks charge.
- By depending more on a prepaid card, you can save considerably the number of fees for operating the accounts at mainstream regular banks plus the charges you pay for commuting. The saved money improves your finances.
- Some prepaid cards provide credit building facility also; it enables the users to improve credit history with UK credit bureaus. As the user uses own money, so, all the major transactions improve his credit report.
- Signing up for the prepaid card is easier and cheaper. No fee prepaid debit cards are also available. It makes your cash safe against pickpocketing as the credit card. Most of the credit cards have an annual fee as well as transaction fee also; here you save a lot.
Can I Have More Than One Prepaid Card?
You need to be 18 years old with UK citizenship. However, parents can buy a card in a child’s name enabling the child to use that card. Since these cards do not affect the credit score, there is no harm in using multiple prepaid cards. The charges differ at large; therefore, it is upon you how to manage the cost by switching from one to other if you get a better deal. As the use of a prepaid debit card is increasing in the UK like in any country, the variety of these cards is also expanding. Today, you have numbers of options to choose the best appealing on the base of transaction fees, monthly fees, issue fees, ATM charges, credit builder option etc. Before applying for a prepaid debit card, explore all the information about terms and conditions for usage. Splash Prepaid Card, Cashplus Gold – Flexiplus, Bread, count Pay Monthly, goHenry Prepaid Card, Optimum Mastercard and Nimbl are the top ranking prepaid cards in the UK.
Card provider needs to authorised or regulated by the Financial Conduct Authority (FCA) under Electronic Money Regulations. Unlike in case of holding cash, you are more likely to get the lost money back if the card is stolen or lost. In the coming years, having prepaid cards are going to become a necessity because the people are getting more conscious about the spending habits that harm their savings. Limiting the expenses is the only mantra to improve the finances and credit score whether you use a credit card or prepaid card.