Prepaid Credit Card originated in Canada. It is not a stereotype credit card but can be used in a similar way. The consumer has to buy the credit card from a company and then has to load it with the required amount of money. Only after that he could use it for further buying but strictly within limit of the load ed money. Hence, it is also known as Stored-Value Cards .
There are different types of Prepaid Credit Card available:-
Multipurpose Credit Card
These are basically reloadable ones where a customer can continue using the card by adding more money to his account. Multipurpose Credit Card s are offered under both Visa and Mastercard .
Non Reloadable Credit Card
This card is also known as Gift Card and is offered under Visa card. Non Reloadable Credit Card cannot be reloaded once the money in it is exhausted. This cannot be used at Automated Banking Machine for withdrawing money.
Prepaid Travel Card
These cards can be used by the travelers instead of the traveler's cheque. Large amount of money can be loaded in this card for traveling purposes.
Payroll Card
These type of cards can only be availed by the employers who use this as an alternative means of paying through cheque where the terms and conditions are set by the employers only. These are reloadable in nature. They are also usable in the ABMs.
Prepaid cards can be used:-
- The minors can be gifted a prepaid credit Card as monthly allowance instead of cash.
- One can use it if he/she wants to avoid carrying cash.
- It has the facility where the limit can be controlled by the user only.
Thus we can see that the Prepaid Credit Card are unique in its characteristics and can be used in a wide array of purposes.