What are Prepaid Cards?
Prepaid cards are just like standard credit cards except that you have to load funds on it before you can make a purchase. Once your card runs out of money, you will have to load more funds on it before you can use it again. And since you load the card with your own money, there is never a balance that you owe and have to pay back. There are also never any interest charges to pay.
There are still many Canadians that are unable to get a bank account with a debit card. But, living in Canada, it can be difficult to function without one. The good news is, prepaid cards offer a way to get many of the benefits of credit cards without some of the challenges. You can get a prepaid card even if you have bad credit. However, as the name indicates, you can’t use it unless you’ve prepaid money onto the card. Since a prepaid card doesn’t allow you to carry a credit balance and pay later, it’s not a credit card.
Even if you don’t have a bank account, you can still rent a car or book a hotel room with a prepaid card instead of having to deal with a bank. Many prepaid cards even have a routing number and an account number, so people can have their paychecks deposited to their prepaid card account.
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Pro Tips to Get the Most from Your New Card
There are a few simple rules that you can follow to make the most of your prepaid card. If you keep these in mind while selecting your card, you can maximize the benefit from your new card.
- Zero Liability Protection – Be sure to register your prepaid card as zero liability protects you from unauthorized purchases if your card is lost or stolen.
- Pay Your Bills – Prepaid cards can be used for bill payment if there are sufficient funds loaded to the card. The acceptance typically depends on the card processor brand so make sure to check this before applying.
- Make a Budget and Stick to it – A prepaid card can help you to stock to your budget since you can’t spend more money than you have loaded onto your card. It forces you to stay in budget every month which is a huge benefit if you have difficulties staying on track.
- Paycheque Direct Deposit – You can have your paycheque deposited directly to the card (where offered by issuer). If this is available to you it could save you time and fees as well as allowing you to refill your card regularly.
Prepaid Cards Summary
Putting a prepaid card in your wallet is easier than you think. They also offer numerous benefits that you can enjoy from day one. There is almost no risk of overspending and they are much safer than carrying cash. Once you get started you will see that they are very easy to use and recharge, making them a practical alternative to using credit cards or debit cards. Select from our approved prepaid cards today and take control of your spending.