Many people don’t know the ins and outs of reloadable prepaid cards, even their most ardent users. This is because it’s a relatively new technology introduced in the 70s. Although used by many as an alternative to traditional banking methods for those who can’t afford them or are banned from banks altogether.
Understandably, there are many myths and misconceptions about reloadable prepaid cards that many people don’t know the truth to. If you’re considering getting a reloadable prepaid card and would like to know the truths behind common misconceptions, then this article is for you.
Common Misconceptions About Reloadable Prepaid Cards and the Truths Behind Them
Misconception #01: You can’t obtain a reloadable prepaid card if you have a bad credit standing.
Using a prepaid card is easy. Unlike credit cards, you won’t be borrowing money when using this type of payment method; instead, the balance available on your card will determine how much you can spend. You also don’t need to prove that your credit score or income are high enough.
If truth be told, you can still get a reloadable prepaid card even if you have made bad mistakes in the past. The process for getting one isn’t complicated either. All kinds of people use them without needing to go through lots of paperwork because there often isn’t any required at all.
Misconception #02: Reloadable prepaid cards work the same way as gift cards.
There are many differences between prepaid and gift cards that you should consider when making a purchase. For example, the purpose of each card is different. Prepaid cards can be used multiple times after being purchased while gift cards must have their balance completely spent before they expire.
Prepaid cards are great for those who want to use their money on the go. As long as you have some money available, prepaid cards can be used countless times until all of your funds run out. When this happens, you simply reload your account with more cash so that it is ready for future transactions.
Misconception #03: Only the unbanked have access to reloadable prepaid cards.
Nowadays, even the unbanked have added prepaid cards to their financial arsenals. Almost everyone is now using this type of card: freelance specialists, parents with wise budgets and students are just a few examples. Anyone who wants ease and convenience can use these types of cards.
In addition, while prepaid cards also charge fees for certain transactions such as ATM withdrawal and reloading the card with funds, these are far less than what most credit cards would cost.
Reloadable prepaid cards can be used by people to segregate their spending so they know how much was spent on groceries or gas etc., without having any expenses mixed up in a lump sum payment each month.
Misconception #04: You can’t use reloadable prepaid cards for online transactions.
With a prepaid card, you can buy anything online without leaving your house. One of the best features with these cards is that they are often issued as debit or credit cards so it’s easy to use them anywhere where those types of payment options may be accepted.
If you don’t have a bank account, reloadable prepaid cards are great to use for online purchases since it isn’t connected with your savings or bank accounts. Reloadable prepaid cards also come in handy as they aren’t vulnerable if there’s a data breach and the information is compromised.
Misconception #05: You won’t have an idea how much your card balance is.
Checking your prepaid card balance or transactions is easy. There are various options to do so, depending on the type of payment you’re using and whether you want instant results.
For example, some cards provide text-message notifications that tell users when they have used up a certain amount in their account. If all else fails, most cards will give mobile access for an online checkup at any time day or night through its website.