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Prepaid cards are like the 'pay-as-you-go' card of the debit and credit card market. You top your prepaid card up with cash and then you can spend it exactly how you would use a debit or credit card.
What can a prepaid card be used for?
Prepaid cards are a great card payment solution for many purposes, whether you are looking to manage your finances and stop over-spending, a safer alternative to cash, a payment method for your son or daughter, or even a contemporary alternative to traveller's cheques.
Manage your finances and stop over-spending
A prepaid card can help you to manage your finances and stop over-spending. You can load your monthly spending budget onto your prepaid card and know that when you have hit your monthly budget, you won't be able to spend any more.
Because you have to put money onto the prepaid card, you’ll always know how much you have spent and you won't get into debt.
Card payment solution for a poor credit history
If you have a poor credit history you may find it difficult to get card payment products, like a credit card.
A prepaid card is an ideal solution because you can get one even if you have a poor credit history, and you won't be able to further damage your credit score because there is no chance of getting into debt with a prepaid card.
A prepaid card offers all the same payment benefits of a debit or credit card, you can even use it to withdraw cash at an ATM machine and you can use it for mail order or Internet shopping.
A safer alternative to cash
A prepaid card is a much safer alternative to cash, and they even utilise the new Chip and Pin technology, so if your prepaid card is lost or stolen someone will need to know your pin number to use it.
Prepaid cards can also be safer than debit or credit cards, because if they are stolen and the person even knows your pin number, they will only be able to get the money loaded onto the prepaid card and won’t have access to your bank account or a large credit limit.
An alternative to traveller's cheques
Traveller's cheques have been around for a long time and nowadays the majority of holiday goers or travellers just take their debit or credit card with them.
A prepaid card can offer an alternative to traveller's cheques or taking cash abroad, and you can even get someone back in the U.K. to load more money onto it should you need it abroad.
A payment method for your son or daughter
Prepaid cards can be used by anyone over 13 years old. So you can get one for your son or daughter as a safer alternative for cash.
You can load the prepaid card with cash for them via the online account management service or at a Post Office.
How do prepaid cards work?
Prepaid cards require you to 'pre-pay' money onto them before you can start using them to pay for your purchases.
You can load money onto a prepaid card via the online account management service offered by the card or at a Post Office. You do have to pay a small fee to load money onto a prepaid card.
Once you have money on the prepaid card you can use it to pay for goods or services like you would any other debit or credit card. They can also be used for withdrawing cash at ATM machines.
Because you 'pre-pay' the money on your prepaid card there are no interest charges involved. However, there are fees for loading money onto the card and for using ATM machines. You may also be charged a fee when you use a prepaid card abroad and some prepaid cards may charge a monthly management fee.
It is important to find out the exact fees charged by the prepaid card you have chosen before you take it out.
Where can a prepaid card be used?
Prepaid cards use payment companies like MasterCard or Visa to enable them to be used at shops and ATM machines.
Most prepaid cards are likely to be Visa Electron or Maestro cards, so they can be used wherever you see the 'Visa Electron' or 'Maestro' sign.
Many retailers in the U.K. accept this payment method and it can be used throughout the world too. Prepaid cards can also be used to make mail order and online purchases too.
Who can get a prepaid card?
Prepaid cards are available to anyone aged over 13, even if you have no income or a poor credit history.
You will probably need a debit or credit card to take out a prepaid card, as there is a small purchasing cost involved. However, if you don't have a debit or credit card someone else can buy a prepaid card for you.
Prepaid Cards
 Extreme Cred is a prepaid card that offers all the benefits and features of a prepaid card. The Extreme Cred prepaid card has no monthly fees and there are no fees when you use the card to pay for purchases in the U.K.
You will need a debit or a credit card to purchase the Extreme Cred prepaid card, which costs £8.95 to take out. However, if you don't have a debit or credit card you can get someone else to buy it for you.
Visit the Extreme Cred web site to find out more, or go straight to the Extreme Cred application page to get your prepaid card.
 Credit card guide
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