Understanding Prepaid Credit Cards

Prepaid credit cards are cards that are paid ahead of time. Therefore, they are not really credit cards in the truest sense. Rather, they are more like debit cards because the cardholder places funds on the card before making purchases.

In order to use a pre-paid credit card, the cardholder must first “load” the card with money. Some of these cards impose a minimum and a maximum on the amount of money that can be placed on the card. The cardholder can then spend up to the amount that is on the card. At the end of the billing cycle, he or she then pays the minimum payment due in order to help restore the amount of “credit” available on the card.

Pre-paid credit cards are an excellent option for those who have a limited credit history or who are working to rebuild their credit. In order for a pre-paid credit card to be effective in this manner, however, the credit card company must report card activity to at least one of the three credit reporting agencies. Therefore, cardholders should check into this prior to applying for a pre-paid card. Otherwise, the card does not serve the purpose of building or rebuilding a credit history, though it still provides the same conveniences credit cards are known to supply.

Beware of Phishing
To Pay or Not to Pay: Is it a Good Idea to Pay Your Taxes with Your Credit Card?
The Financial Dominance of the Credit Card Industry
Keeping Your Credit Card Safe
Traveling With Your Credit Card
A Look at Current Bankruptcy Laws
Fixing Mistakes on Your Credit Report
Flying With Credit Card Airline Miles
Get Stylish with Your Credit Card
Keeping Your Credit Report Clear
Modern Day Vending Machines
Using Pre-Paid Credit Cards for College Students
Making Sense of the Prime Rate
Protecting Your Credit Card Account Information
Reasons to Use a Credit Card Instead of Cash
Rising Minimum Payments: Friend or Foe?
Staying Out of Debt While Using a Credit Card
Pay Your Way Out of Debt with Your Tax Refund
Tips for Shopping Online With a Credit Card
Understanding Airline Miles Credit Cards
Understanding Cash Back Credit Cards
Understanding Prepaid Credit Cards
Understanding Rewards Credit Cards
Understanding Student Credit Cards
What to Look for in a Credit Card
What to Watch Out for in Pre-Paid Credit Cards