What is a Prepaid Credit Card?
What is its purpose? Prepaid cards are different from usual credit cards since the credit is provided before applying for the card. This system is dissimilar to normal credit cards which require the payments after the purchases are made. Prepaid credit cards are offered by leading credit card companies. These cards can be used in the various payment networks just like a conventional credit card. The preloaded balance in the credit card is deducted after making purchases.

There is no charging of interest on the purchases as the account has been preloaded. However a number of other fees have to be paid on a prepaid credit card. The card is sometimes referred as "an expensive way to spend your own money" since the extra fees being charge will erode the balance. These cards can also be used to make online shopping and will ensure that the transaction will be completed. The cards are sometimes marketed to teenagers who are not eligible for a normal credit card.

Advantages of having a prepaid credit card The prepaid mastercard cards are deemed to be accepted and eliminate the risk of being rejected at shops. This feature will make it very attractive for travelers on their journeys. The card will be accepted wherever a normal credit card is accepted. The prepaid american express card does not affect your credit score. Credit bureaus in Canada deduct points off your score when a credit card company accesses your profile. Credit card companies usually check the profile when a person applies for a credit score.

Whereas in a prepaid mbna card, the company does not checks the credit report thereby it does not affect the score. Students and new immigrants usually would be unable to secure a credit card in Canada. These prepaid student cards would be very helpful for such people since they do not have any credit history to secure normal credit cards. Those who have bad credit score due to various reasons will find it very difficult to get a new credit card.

A prepaid credit card is the best solution since it does not take credit score into account. There are people who splurge on their credit cards and find it hard to repay the amount and get stuck in paying interest charges as well. These people can go for a previously funded credit card from you bank account since it limits the amount that can be spent. The startup amount required to get a credit card is in the order of thousands of dollars. This might be too high for people like students. Prepaid credit cards do not require such a high cost and are available starting from hundred dollars.

Canadian Prepaid credit cards Most of the leading banks in Canada offer these cards. These are various schemes available for the customers to choose from. The major payment networks support the cards in Canada. The Banks offer many schemes targeted at the large overseas student community in Canada. The banks also offer special schemes and cards for new immigrants to Canada. Prepaid visa cards are a boon for people who cannot afford a normal credit card.

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