Why we use Prepaid Credit Cards

Published: 12th August 2010
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Is your application for credit card rejected because of your bad credit rating? Do not worry. Prepaid credit cards have a solution for you. Although people with good credit rating can also benefit from a prepaid credit card, it is a boon for those who have a poor credit history.

A credit card for everyone

A prepaid credit card is issued on the basis of money that you deposit in your bank account. You can make withdrawals or payments through these kinds of credit cards till your bank balance is not exhausted. After that you have to refill your banks account with more money that you can use through your credit card to pay your expenses. As these cards are prepaid and the bank does not have any risk of bad debt, even people with a bad credit rating can get this card.

Save you from bankruptcy

A normal credit card allows you to make payments even if you do not have any balance in your account. Most of the people loose track of the amount of expenses they have incurred. A credit card provides liquidity in your hands and many of us get induced to spend much more than what we can repay. Heavy interest charges and financial indiscipline in spending money can lead to bankruptcy. There are no such problems in case of prepaid credit cards as we have paid for everything in advance.

Low charges

Unlike normal credit cards; a prepaid Mastercard, prepaid Visa card, or any other prepaid credit card have very low interest charges attached to it. Many banks do not even charge any interest on a prepaid credit card as you are using your own money that is deposited in the banks in advance. Usually, you are only required to pay a certain fee when you buy a credit card. Then, you have to pay charges for depositing or refilling money in your bank account. The benefits offered by a prepaid credit surpass the charges that are to be paid to maintain it.

For More Information, please visit our website at http://www.compareprepaid.co.uk

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