Prepaid credit cards just gave plastic money a new popular twist. There is no going beyond limit because the cardholder is only allowed to spend what has been already paid off. It is like a gift card, only it can be used around with different merchants.

Prepaid credit cards have a lot of benefits aside from the obvious that you can never have an overdraft because you simply cannot use it once the limit is reached. This type of plastic money is best for people who are impulse buyers or those whose credit report is poor. By owning this card, one may avoid debt altogether and slowly rebuild credit score.

Parents may supply their teenaged kids with this card instead of just issuing them with ATMs because kids these days have already discovered the power of online shopping and having prepaid card under their belt is something that can help them develop budgeting skills. Parents can just load the card with the allowance and the kids decide how to spend their money. Just like a regular card, purchases and other transactions are recorded for proper monitoring so kids are discreetly taught financial management early on.

There are also prepaid credit cards made available for specific purposes. For example are travel cards that make traveling more secured in monetary aspect because you need not bring large amounts of cash without the fear of over-spending during your holiday. Then these are also zero liability plans that relieve you from unauthorized and fraudulent use while protecting you from card and identity theft. Even if this is an unsecured card, the benefits sometimes outweigh the disadvantages, right?

More and more employers use prepaid credit cards in their payroll system. The companies are provided with an easier system while giving their employees easy and automatic access to their funds. Direct deposit is made and the employees can withdraw their money in real time without having to fall in line in a bank and cash pay slips. The card gives the employee the flexibility he needs in everyday living. He can use it to pay for gas and groceries and at the same time withdraw funds for other home bills.

There is set-up/start up fee involved in this account, though. Some companies charge minimal amount while some are compelled to charge more substantially. This is a minor setback and something that can be solved by searching your options first before signing up with an account. Like regular applications, your options must be made open so you can choose the best offer that can meet your individual needs.

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