Most people who use prepaid cards point out that they are the better and safer alternative to credit or debit cards. This is because one can only use what is on the card. This leads one to creating budgets and you will never once find yourself in the red.
Prepaid cards are accepted and used as a means of payment locally and oversees. They are now often the preferred choice for setting bills especially when compared to cheques.
Not susceptible to fraud
People all over the world live in constant fear of identity theft and card related fraud. Such people find that using prepaid cards is the safer option. Prepaid cards have no link whatsoever to your bank account and are protected by a pin. This means a prepaid card user can easily purchase items online and rest easy knowing that no fraudster will get access to their pin and use it to commit fraud.
Safe for travel
If you are constantly in and out of the country, prepaid cards are the perfect choice as they are completely safe. They are similar to travellers’ cheques and can easily be replaced if damaged, stolen or lost. That said, reporting a lost or stolen card will require you to call the helpline and this replacement may cost you amounts of up to £35. This is the norm for most prepaid cards apart from Travelex who have a working emergency number 24 hours of every day and who offer money transfer services anywhere in the world for free.
Most prepaid cards
Prepaid cards being used to date are usually loaded using dollars, sterling pounds and euros. When loading with euros and dollars, the exchange rate is a fixed one. This is advantageous because you will benefit when the rates take a dip.
No extra exchange fees when making your purchases
This is the complete opposite of credit and debit cards which accrue foreign exchange fees on any purchase done when abroad. Prepaid cards do not have such fees as long as the currency in the country where you are making your purchase is the same as that one in the card. The only fees imposed are the cross-border fees in a case where you are using a sterling card in a Eurozone. The fees are about 2.75% or slightly higher.
Access to the chargeback option
This is particularly useful if you are victim of a failed transaction, fraud or theft. If any of these three scenarios were to happen to you, you have the option of claiming back all you have lost. The same option is also available if you do not receive the item(s) you purchased the same way they had been described. To get back this claim you only need to place a claim to the prepaid card provider.