The concept of prepaid cards isn’t all that new but has just recently begun to gain some popularity. Credit cards and debit cards are so deeply ingrained in our daily lives that prepaid cards never really seemed to gain much momentum at first but, with some airline/travel websites now waiving excess charges and booking fees if you use a prepaid card, and some prepaid card companies launching cards with advanced features, they have finally started to catch on.
Basically a prepaid card is a type of plastic card on to which you load your money, much like you do with a prepay phone card. You can then use your prepaid card just like you would a debit card from a bank account, including anywhere in the world where that particular type (MasterCard, Maestro, Solo, Visa Electron and Amex) of card is accepted and for online shopping on the internet.
It is a fantastic financial tool for consumers, especially those that have trouble getting a bank account with a debit card facility (for example consumers with poor credit or those that have recently moved to the UK from abroad) and/or prefer to budget their money for different purposes.
While they are very similar to the kind of gift cards that you can purchase from any high street retailer, there are now many other advanced features currently available on everyday prepaid cards.
Some of the best types of prepaid credit cards offer you not just the facility to be able to load money on to your card whenever you want but also allow you to have 24/7 access to online banking, telephone banking and mobile banking. Some prepaid cards offer you purchase protection and, as an extra security feature, will provide you with restricted access to pre-approved transactions.
Some cards charge you no fees whatsoever after you initially purchase them. Basically they are like a one-off investment which will usually reap a lot of rewards for you due to their great features. Be careful of those that charge you every time you load money on to your card; there are plenty of those out there. There are certain prepaid cards available that even give you cash back when you shop at popular retailers, including popular grocery stores.
Since their initial launch, prepaid cards have started to evolve and adapt to the needs of those that use them so most now offer some extra, advanced services as well.
For one thing, you may be allowed a big daily withdrawal limit; sometimes up to £500 a day (some debit cards issued by banks only allow you to withdraw £200 a day). Some will even offer a credit repair facility which enables you to improve your credit score just by using the card and paying the monthly fees on time (even these cards don’t require credit checks). This is obviously a big plus point for people with a ‘slim’ credit history or those who have a poor credit history because they have had County Court Judgments (CCJs), etc.
In addition, there are now prepaid cards on the market that offer almost all the facilities of a full current account. These products have a monthly fee attached to them but you do not have to worry about being charged any bounced payment fees or incurring overdraft fees. Just like a current account you get a sort code and account number meaning you can have your wages paid straight on to your card and then set up standing orders and Direct Debits for bill payments. Also just as you would with a standard current account, you get access to online and telephone banking facilities.
Another new feature to enter the prepaid market is international money transfer. This feature on certain cards allows users to have two cards, one for themselves and another to be sent to friends or family abroad. The user simply loads their card with money and they can transfer it to the other card anytime, day or night. This is seen as a safe and simple way for users to send money home should they need to.
Finally, some of the newest prepaid cards launched have contactless technology, which allows you to pay for purchases of £15 or less by swiping your card over a reader without entering your PIN, a sign that prepaid cards are really starting to present some serious competition to the standard Debit card.
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About Advanced Payment Solutions Ltd (APS)
APS is the leading European prepaid card provider, with more than 500,000 cards issued and £500,000,000 in payment turnover. Its flagship product, the award winning Cashplus prepaid Gold MasterCard® is the UK's first general purpose prepaid card for consumers and in the last couple years APS has developed a growing interest among small businesses which now exceeds 2,500 who are utilising the benefits of the Cashplus prepaid Gold MasterCard to manage and control their business expenditures.