Today’s post was written by Nicole. She is the Marketing Manager for Consumer Products on our Brand and Group Marketing team.

What’s a prepaid card?

Prepaid cards work like a credit card but act like a debit card. Confused? They’re like credit cards in that they can be used anywhere MasterCard® or VISA (depending on the card) is accepted. But it acts like a debit card because there must be money on the card before you use it. The best part? There are no interest charges because you aren’t borrowing money.

It’s the same concept as a prepaid mobile phone account. Unless the account already has money on it, the phone (or in this case the card) will not work.

Why use a prepaid card?

There are lots of reasons you might get a prepaid card. Maybe you’d like to spend your money privately without statements showing up at home; or maybe it’s as simple as either being unable, or unwilling to get a credit card right now. Perhaps you need to get a little more control of your spending, so you want to keep your budgeted “fun money” on a prepaid card instead of in your bank account. Many people use them for travel so that in case they lose their wallet, they aren’t losing all of the money in their bank account.

But how do you know if a prepaid card is good or not? Here’s 10 things to consider before signing up for one.

1. How convenient are the loading options? Do you have to leave home or can you do it online?
2. How high are the ATM limits and what’s the comparative cost for withdrawing money? Quite a few prepaid card providers have low withdrawal costs, but you can only take out little bits of money at a time making it more expensive in the long run to get cash in your hand.
3. Are there any point-of-sale (POS) fees? There shouldn’t be.
4. Does the provider charge application, monthly usage or non-usage fees? This is where a lot of providers have hidden charges. Some providers even charge you monthly fees just to have the card!
5. What’s the security of your card? Demand Chip & Pin technology so you protect your hard-earned cash
6. Can you get a virtual counterpart? Does your issuer think to provide you specifically with a card that you can use for buying stuff online. Very few companies offer this because it’s new technology, but it’s definitely the safest way to buy online because virtual cards let you generate one-time use numbers that can never be used again. That means you’ll never lose your card number to a nefarious individual.
7. Does it offer rewards for every time you use it? Most companies charge you to use it, but there are a few out there who also reward you! Check out the card company to see if they offer any loyalty points or cash rebates.
8. Does it allow you to pick the currency that works best for you? For those of you who travel and need access to other currencies, this is a must-have.
9. Is it accepted worldwide? Preferably it should be MasterCard or VISA.
10. Is it a piece of plastic you can be proud to use? Let’s face it, a lot of prepaid cards look a little dubious or like they were mocked up in a garage. You want to be able to spend with confidence with a card that looks legit.

Good luck in your search for a prepaid card, but since you’re already in hunting mode, check out our Net+ card. It definitely hits all the right notes.

All you prepaid card users out there let us know how Net+ stacks up.