What is a prepaid card?


In the financial market, you can use an increasing number of financial products that greatly facilitate the implementation of secure payments. One of such products is prepaid cards.

Otherwise called prepaid cards, they allow you to make payments without having to have a personal account or sign contracts with financial institutions.

Prepaid cards, unlike payment cards, are not personalized. There is no information on the owner on the cards. Prepaid cards may have but do not have to be assigned an owner. The amount of funds on the card depends on the amount of such a card will be topped up. Topping up prepaid cards is possible both by making a cash payment on the technical account of the card as well as using the transfers.

Prepaid cards are often used by children whose parents want to be sure that the child will have access to financial resources without being robbed.

Using prepaid cards

Prepaid cards are used in the same way as with payment cards. Each prepaid card is accompanied by a PIN, which is then used when making the transaction. At the same time, a technical account is also assigned to each prepaid card, through which top-ups can be made.

The advantages of prepaid cards

The basic benefits of prepaid cards include primarily the safety of their use. The ability to top up a prepaid card allows you to limit the number of funds you can use when using a pre-paid card. At the same time, the card is not connected to the bank account.

When such a card is lost or stolen, it is not possible to steal funds from the bank account. Using a pre-paid grille by children, you can also precisely determine the amount of top-up, which will be used by the child on the card in the form of financial means. This allows you to limit the sums of money that children can use every day using prepaid cards. Such cards can also be a solution for older people who want to increase the security of using payment cards.

Disadvantages of prepaid cards

Prepaid cards also have their drawbacks. These are payment cards that work almost exclusively when making non-cash transactions. Such transactions using prepaid cards can be made completely free of charge. However, all other activities carried out with the use of cards are payable.

This applies, among other things, to withdraw funds from an ATM using a prepaid card where the technical account assigned to such a card is used. Obtaining all information such as account balance or card balance is also payable and the fees are high compared to payment cards used for bank accounts. Payable when using prepaid cards is also buying the remaining funds on the card, which is sometimes necessary when resigning from the use of the card or when the card expires.