What is a prepaid credit card?
When it comes to prepaid credit cards, they offer many benefits, including ensuring that you won’t overspend because—that’s right—they’re prepaid.
While they are spent like credit cards, they actually function more like debit cards because you are spending your own money by loading the card yourself. Another way of thinking about prepaid credit cards is that they essentially function like gift cards—except you’re using your own money.
Having a credit card can offer you greater flexibility, as they are associated with major credit card networks such as Visa and MasterCard. Prepaid credit cards provide the convenience of everything associated with a credit card (with it often being a preferred method of payment) without risking going into debt.
Prepaid credit cards are a great option for those with poor credit, not only providing them with the benefits of having a credit card, but also helping those with poor credit develop better spending habits.
Prepaid credit cards are different from secured credit cards, which require approval from a bank and a security deposit before you can use the card (usually $300 to $500). As well, the spending limit on secured credit cards is the amount you put forth as collateral. On prepaid credit cards, there is technically no limit.
While there are many benefits to owning a prepaid credit card, there are also some things you should know before getting one. For example, though you do not need good credit to have a prepaid credit card, having a prepaid credit card does not help you build your credit.
All major banks offer prepaid credit cards, and often charge activation and monthly maintenance fees, but these fees may vary depending on the bank and the card. Some prepaid cards are completely free of charge.
Though you can get a prepaid credit card even if you have a poor credit score, it is nonetheless important to build your credit score. Learn why a good credit score is important here.
UrLoan can provide you with a loan and help you improve your credit score. Our approval system is based on employment and verifiable income, unlike any other traditional means of credit score used by such institutions as banks, or taking security on your assets.
Call us at 1-855-723-5626 and get back on track towards financial health.