Prepaid cards are becoming popular in the USA as a good alternative of cash. For many users, they are better than regular debit or credit cards. There is no need to have a checking or savings account to get one of these cards. Moreover, a person with poor credit score can qualify. They are a useful and effective alternative to walking around with lots of cash.
Prepaid cards come with a fixed limit or balance. Your balance equals the amount of money you deposited. After you have spent that money, you have to recharge or discard it. You can track your balance either at the issuer’s website or, for example, at Prepaid Card Status. All you need to do is key in your security code and card number. Apart from finding out what your balance is, you can also get information on the purchases you made.
With the use of prepaid cards, you can earn lucrative rewards. It is an excellent way to save money via discounts. They are great for people who cannot decide what gift to buy for a family member or friend. Most of us like presents that alllow us to buy whatever we want.
Incentive for Employees
They are also a useful option if you need to offer your employees a way to pay for things while on the go but don’t want to issue them with a credit card. The employer simply loads funds, gives it to an executive, manager, or other staff member, who can then use it to pay for meals, etc. when visiting clients or on a business trip. However, the employer is in full control at all times.
Employers can also give this type of card to their workers as a reward.
Help Friends and Relatives
For parents who want to make sure that their young adult offspring are safe in an emergency while abroad, prepaid cards are a godsend. If they lose important medications, for example, they can use the card at a pharmacy or to pay for a doctor’s visit if they require a prescription.
Rather than giving your kids cash for their birthday, you could them them a prepaid card. You could also use it as a means to transfer pocket money to your kids. If you pay them every week, you simply add funds each week.
Most people have their tax refunds paid directly to their savings or checking accounts. For people who don’t have a bank account, however, a prepaid card account is a good alternative.
Most prepaid cards have direct deposit facilities. In fact, some of them offer a bonus when users deposit their tax refund on their card.
Benefits of Prepaid Cards over Standard Cards
Prepaid cards allow you to enjoy numerous benefits. Here are some of the main advantages:
Don’t Worry About Credit Checks
Every time somebody applies for a credit card, savings account, or checking account, the bank will perform a credit check. If you have not managed your finances optimally – perhaps you didn’t pay bills on time or issued checks that bounced – your application for an account or card might be turned down. People with a bad credit score find it harder to borrow money and get credit cards.
If you want a prepaid card, however, the issuer does not run a credit check. It doesn’t have to know about your credit history because there is no risk – you are not borrowing money. The money you use in this type of card came from you.
In the past, people got their paychecks, went down to the bank, waited in line, and deposited it in their account. However, those checks took two or three days to clear. Immediate access to their wages was only possible if their employer paid them in cash.
Nowadays, most employers pay people straight into their bank accounts. They can also pay straight into your prepaid card account. We call this type of transfer a direct deposit. This means that you have access to your money immediately.
In today’s digital age, a growing number of employers are adopting a paperless payroll system. In fact, some of them have gone completely paperless.
Save time, parking fees, and fuel with prepaid cards. Why leave the comfort of your living room or bedroom if you want to purchase something?
Since the advent of the Internet, how we work, play, study, shop, and communicate with one another has changed dramatically. Having a prepaid card allows you participate in this change that most other people are enjoying by doing your shopping online.
Surfing the Internet, scanning through different online stores, comparing prices, and reading reviews is easy, convenient, and straightforward.
In most of the advanced economies, prepaid card owners have the same protection against fraud or theft as with their checking accounts.
If you suspect that somebody has fraudulently taken money out of your account, tell your card issuer immediately. They will help you determine who is liable. They will also give you useful advice on how keep your funds safe.
Also, with a prepaid card, fraudsters cannot put you into debt to the tune of thousands of dollars. The account can never go into the red. In a worst case scenario, you would only lose what you paid into the account.