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| Advantages Of A Pre Paid Credit Card. |
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Surfacing in the 1990s, the pre-paid is novel idea to help people to secure credit when there credit score was to low. The consumer can only spend the amount of money that is deposited in the account. When enough credit history is established the credit card company slowly increases a credit limit past the pre-paid amount and as the extended balance is paid off, the customers credit score increases. Sometimes the amount of money extended can be 100-200% more than the original deposit. Though it sounds like the customer is just using a debit card, the advantages of a pre-paid credit card are numerous.
One advantage of a pre-paid credit card is that it is accepted just like a traditional credit card. World wide the card can be used to pay for products and services and not even the merchant will know that there is a difference between the pre-paid credit card and the regular interest bearing card.
Since the money is the customers and not the bank, there are no worries about unpaid bills or accumulating debt. It is the customers money and the limit of the card is the amount that the customer deposits. There no chance of bad credit scores because you are building credit not using credit.
Anyone can have a pre-paid credit card. All the customer has to be is 18 years old or older. They can apply, deposit money, start using the card, and their credit begins to build. There is no credit check since the customers that use these types of cards are there to build credit in the first place.
There is no check or bank charges. The card is like a credit card, but the bank only holds your money where they invest it and use it until you take it out. This is how the bank makes money while you earn credit, not interest on your money.
You can add money to your deposit at anytime, anywhere in the world. Any bank, ATM, or online facility can accept your deposit when the balance of your car is getting low.
Your existing credit can never be jeopardized because you are not using credit, your using your own money. Your credit score can only go up.
You can use the card for anything like a nice dinner out, a trip to the movies, to pay bills, or to just spend on a shopping spree. You can get cash worldwide from ATMs so if a merchant does not take credit cards, you are covered.
If you like giving gift cards during the holidays, a pre-paid credit card is a great way to give your children or relatives a gift of money but limit the amount they spend. Children can have their own credit card and the parent can set the balance to what they want to keep the child’s spending habits under control.
The advantages are many and these are only a few. If you have poor credit or you are looking to start credit for the first time, a pre-paid credit card is the right way to go. |
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