Prepaid debit cards
In the United States there are nearly 1.5 billion cards in circulation among a population of about 300 million. A vast majority of them are credit cards which certainly have a charm of their own. To get a credit card your credit rating must be positive and once that is established getting a credit card is fairly easy. However there are many Americans with a damaged credit rating who unfortunately cannot access the offered credit cards. Again there may be a lot many of us who do not have bank accounts. For such people getting a card with the prevalent logos of Visa, Discover, MasterCard or Amex must remain only a wish on paper. Such people who number close to 60 million cannot have the convenience of a credit card. What about them? Well for such people a prepaid debit card is an excellent option. Prepaid debit cards should not be confused with credit cards.
These debit cards give you the convenience of a credit card as well satisfy your ego of possessing a card and use it with impunity. Such cards which are reloadable debit card allow you to only spend up to the amount you have pre-deposited into the account. These cards are pre loaded up to a particular limit. The limit is the cash deposited by you. The owner can use this card till the money on the card is exhausted. In that case once the limit on the card is exhausted then he has the option of reloading the card with more cash.
Another important use of this card is the control it can exercise brakes ion your spending. Because once the limit is exhausted the cards utility is zero. Such card is excellent for students and people who wish to control their expenditure. If you tend to overspend or would like to control youre spending then a pre-paid debit card or prepaid credit card could be a good card for you. Prepaid debit card acts like a combination of a credit card and a debit card (and is even called a prepaid credit card sometimes).These cards allow cardholders to load money onto it and then to use the prepaid card anywhere a debit card is accepted. However there is subtle difference between these cards and credit cards. As these cards have money loaded onto them in advance there is no credit risk involved for the issuer. This is in sharp contrast to credit cards which give you a line of unsecured credit from the issuer and do have an element of risk.
These prepaid cards however have all conveniences associated with ease and use of credit cards. Thus you can use them freely at gas stations, grocery stores or on the net for online purchases. These renewable cards are also issued under the MasterCard and Visa aegis and carry their logo.
People who swear by prepaid cards generally point out that compared to bank accounts they have greater utility and incur lower costs. They are also easier to take with you and obviate the necessity of carrying cash with its inherent risks.
The magnitude of usage of these cards can be gauged from the fact that last year in 2006 nearly $117 billion of purchases were made on such cards. There are many people who opt for these cards and you can also join them. An estimated $117 billion of purchases were made in 2006 on these pre paid cards. Forecasts by MasterCard estimate that by the close of 2009 these stored value cards( euphuism for prepaid cards) can have transaction of nearly $257 billion. Thus the future has exciting possibilities.
People who market these cards make a significant point. They emphasize that these cards benefit the poor and needy Americans who are destitute and have no bank accounts. They claim to bring about financial education to these people. Its a sobering thought that nearly an estimated 13% Americans families have no bank accounts. Meanwhile, it is getting easier to use prepaid debit cards. Due to the enormous size of the market, Visa is targeting on a nationwide network of retails plazas where consumers can reload cash onto their Visa-branded prepaid cards.
The prepaid debit card options are on the increase. The biggest names in the financial world have gone for these cards with gusto. Citibank and J.P. Morgan Chase have also entered the prepaid card field and are marketing their products to the American consumers.
Another important point that needs to be emphasized is that Visa is targeting millions of Americans who have no bank accounts yet have an annual earning $ one trillion and end up paying $1.5 billion of this income in check-cashing fees to banks. These checking fees can be obviated in case workers directly credit their salary to the prepaid card and not the bank.
All-Access Visa from NetSpend issues reloadable debit cards along with the major banks. They are marketed to Americans through retail outlets and websites like CreditCards.com
From what I have written prepaid cards have an exciting future. There is a good chance that many Americans may find it worth while to opt for prepaid cards. So in case you decide to have a prepaid card then the process of getting one for your use is very simple and can be applied for on line. Nets ends All-Access Visa Prepaid Card is available through the CreditCards.com website and the best part is that in two simple steps and one minute you can have a prepaid card approval. The card can be physically in your hands in five working days.
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