Steve Evans recently asked:


rds are a part of daily life these days. For each of us to establish a good credit rating is very important for many reasons from getting finance to getting a job.

Prepaid credit cards are a way for someone who cannot get a traditional credit card to build credit. The classic case here is the person who has declared themselves bankrupt. Once anyone does that their credit rating is reduced to zero and people describe that as having a bad credit rating, or just bad credit.

This is where a prepaid credit card can be a life saver.

There are some pros and cons to prepaid credit cards, so shopping around and being informed is important when getting one. A prepaid credit card will help build credit without the risk of falling into debt and hurting your credit rating even further.

A prepaid credit card is basically like any other credit card. It is backed by one of the major credit card companies. Prepaid credit cards, though, are completely controlled by the user. The account for the card is opened with a deposit that is then the credit limit. Whenever the user desires more money can be added. Only the amount of money that is in the account can be spent. If the user tries to spend more than their limit the card will be denied.

Walmart and Walgreens provide prepaid credit cards but there are many others. You load the card with an amount of money. Then you re-load it every time you need to use it.

Prepaid credit cards are really becoming popular because they are convenient and allow you to better budget your money than a regular credit card.

Charges vary from card to card, but it’s always best to compare fees before deciding which prepaid card is best for you. You can also find links on the above site to purchase prepaid cards.

Pre-paid credit cards are credit cards in which the owner of the card deposits funds with the credit card issuer to be accessed via the card. This is in contrast to a traditional credit card in which the credit card issuer gives the user a card without receiving any money in advance.

The merchant uses their standard procedure for accepting credit cards of any type. This often involves swiping the card through a terminal. In this case, the terminal is connected to a network that allows the card to be approved or declined. In the case of a pre-paid card, the amount of the purchase is compared to the amount of funds remaining from the original deposit. If there are sufficient funds available, then the transaction is approved. The amount of the purchase is deducted from the funds that were originally deposited with the credit card issuer and the remaining funds become the card\’s new balance.

Any government agency can deposit unemployment benefits, child support payments, etc. directly into a prepaid card, as your employer can do. You might be able to put money in it by yourself. The money can be used right away and the amount you spend or withdraw is deducted from it immediately. Just like debit cards, prepaid cards have a personal identification number.

There\’s nothing simpler. You pay up front. When the card runs out, you refill it. Use it like a credit card, but no bill at the end of the month, only a statement showing what you\’ve spent. That\’s why it\’s prepaid.

All you do is to decide how much to put on your prepaid credit card - and deposit that amount on the card, as you would into a bank account.