Tuesday, August 10, 2010

What are the rules for Obtaining Prepaid Credit Cards?

Credits cards are really helpful while you are out for shopping. You need not carry cash with you and also credit cards allow you to remove any limit on the amount of shopping you want to do.

But when it comes to paying up that credit many people finds it hard to make the both ends meet. Realizing this many banks have introduced prepaid credit cards so as to reduce the burden of high interest rates.

A prepaid credit card is just like any other credit card but the thing is that you need to have that amount of money in your bank account as that same amount would be deducted from your account almost immediately.

Just like the traditional credit card you need to have a minimum deposit in your account and also it has limits over the extent of expenditure. You can extend the amount you can expend but that will only be facilitated upon special request.

These terms and conditions imposed on the credit cards vary from one company to another. For this you need to compare what a company is to offer before obtaining their credit card.

While choosing a credit card there are certain pitfalls that you must avoid. Don’t go for the company which demands to keep your application on leverage on condition that you buy something from them. Avoid getting credit cards form the company that treats you with contempt. Since you are paying for their service you are entitled to be treated with proper respect and care.

You must avoid over drafting and the temptation of over expenditure such that you come to the brink of bankruptcy. The freedom of expenditure that is being offered by the credit cards does not give you any right to exploit it. You must be sensible while you use the credit card and keep the expenditure to your limits so that when it comes to repayment you don’t have to fight hard to make the both ends meet.


Unknown said...

Nice article. Going prepaid is great way of gaining control over your finances. It's also a safer and more secure way of shopping online.
Check out 3V Visa , Canada's first prepaid voucher for shopping online without a credit card. http://www.3vcash.ca

Unknown said...

As a parent, I let my son have his first credit card as prepaid because they say it's safer. That way, he won't be tempted to go way above his spending limits. It's a lesson for teens too, giving them financial responsibility early on can help them in the future.

Nice blog by the way.

Linda Casey
Credit Cards for Students

Admin said...

Nice info. Quite hard to get credit card for people in developing countries.