Prepay cards are relative newcomers to the financial world. But they can be so useful that anyone looking for plastic, without the worry of running up debt, may wish to consider them. So who can use pre pay cards?
People with all kinds of credit histories
If you have a poor credit rating, prepay cards are typically still available for you to use. This is because no credit is offered on them. Instead, you pay your money onto the card before you spend it, so you do not need to worry about getting a bill or being landed with late payment charges.
Also, credit checks are usually not carried out when you apply for a card.
People of all ages
If you have a teenager who needs to learn about managing their money, a prepaid card could be ideal. You can load as much or as little money as you like onto the facility, and track your child’s spending, typically online or via SMS statements.
Not only will you know how much they are spending, but if the card is used in shops or online, you will know when and where the money is being spent.
As no credit is offered with prepaid cards, your son or daughter does not have to be 18 to have one.
People who want to travel
Pre pay cards can usually be used internationally to withdraw funds in different currencies, so they can come in handy if you are planning to go travelling. Always check with your card provider for details of the exchange rates that they offer, so you know what to expect when you make a withdrawal or purchase abroad.
People who want to manage their money
Some people find it easier to manage their money if they have a prepaid card for different areas of their expenditure. So you could have one for bills, one for household shopping and another for treats. This means that you have all the convenience of having a plastic card – ie not having to carry cash around and being able to buy online and over the phone – without the worry of overspending and attracting interest charges.