A prepaid card differs from a debit or credit card only because it is not linked to a bank account, and you are spending money you have already put on the card. As such, you can’t overspend on a prepaid card, which is perfect for someone with a bad credit history, reducing the possibility of becoming overdrawn and going into debt. There is also no credit check on application, making it a good option for those with low credit scores.
A prepaid card can be useful if you are trying to stick to a budget in order to start saving, or to improve your credit score. It is also a useful way of being able to give young adults a way to spend money and learn to manage their spending themselves, without the risk of going overdrawn. It is also possible for you to put foreign currency on a prepaid card to be used abroad and avoid the fees usually applied to credit or debit cards being used abroad.
Start the process and go over to our comparison chart to see what options there are when it comes to prepaid cards. However, before you make your choice, be wary of the various fees, such as monthly fees, loading fees, and withdrawal fees, that can be charged to a prepaid card.