In among the many different options to pay by means of plastic money, people often end up being confused on debit and co-branded prepaid cards. They are way too similar both in their cancellation policy as well as their usage for most of them to be really sure of which one they should choose from. So, you may exploit them worldwide and they may be cancelled when stolen or lost with ease. However, their logos make them distinct. This article addresses those concerns to make selection for you easier.
Will There Be Any Credit Issuance? There is no credit issuance with the use of a prepaid card. It is a simple process of loading your money and using it through a co-branding prepaid card across the world. However, there is an overdraft facility for debit cards by the banks even though debit card holders can easily withdraw money from their accounts.
Credit Check for Card Eligibility. In case of prepaid cards, no credit check is performed before issuing a card to the customer. However, in case of debit cards, banks will usually perform a credit check to ensure the credit score and rating of the account holder before issuing a card to them.
Interest Fees. Prepaid cards do not allow people to borrow money and thus, no it nest is involved. However, in case of overdue overdrafts, debit cards are charged with interest fees with no interest-free periods.
Are There Any Card Charges? A small maintenance or opening fee is usually charged in case of prepaid credit cards, especially for co-branded prepaid cards. While in case of debit cards, a certain fee is charged applicable to the bank account and penalty fee is also charged in case of overdue overdrafts.
The Credit to be Issued. Since prepaid cards are yet another method to use an individual's money, the person will not be issued any credit by means of using this card. In order to use it effectively anywhere in the world, you have to load the money and get it linked with a co-branded prepaid card. Most of the people are likely to find the debit cards more appealing for the fact that they have an overdraft facility even as they agree to let them withdraw the required amount from their account only.
Using ATMs. Not all of the prepaid cards empower a bank customer to be able to withdraw their money through an ATM whereas debit cards do facilitate their users with this benefit.
Overall, debit and prepaid cards both have their differences but are similar in their usage and cancellation policy. This means that both cards can be used anywhere in the world, depending upon the logos that are present on them. Both of these cards can also be cancelled with ease if lost or stolen.
Will There Be Any Credit Issuance? There is no credit issuance with the use of a prepaid card. It is a simple process of loading your money and using it through a co-branding prepaid card across the world. However, there is an overdraft facility for debit cards by the banks even though debit card holders can easily withdraw money from their accounts.
Credit Check for Card Eligibility. In case of prepaid cards, no credit check is performed before issuing a card to the customer. However, in case of debit cards, banks will usually perform a credit check to ensure the credit score and rating of the account holder before issuing a card to them.
Interest Fees. Prepaid cards do not allow people to borrow money and thus, no it nest is involved. However, in case of overdue overdrafts, debit cards are charged with interest fees with no interest-free periods.
Are There Any Card Charges? A small maintenance or opening fee is usually charged in case of prepaid credit cards, especially for co-branded prepaid cards. While in case of debit cards, a certain fee is charged applicable to the bank account and penalty fee is also charged in case of overdue overdrafts.
The Credit to be Issued. Since prepaid cards are yet another method to use an individual's money, the person will not be issued any credit by means of using this card. In order to use it effectively anywhere in the world, you have to load the money and get it linked with a co-branded prepaid card. Most of the people are likely to find the debit cards more appealing for the fact that they have an overdraft facility even as they agree to let them withdraw the required amount from their account only.
Using ATMs. Not all of the prepaid cards empower a bank customer to be able to withdraw their money through an ATM whereas debit cards do facilitate their users with this benefit.
Overall, debit and prepaid cards both have their differences but are similar in their usage and cancellation policy. This means that both cards can be used anywhere in the world, depending upon the logos that are present on them. Both of these cards can also be cancelled with ease if lost or stolen.
About the Author:
Debit cards are a good option for those customers who already have bank accounts and will not be tempted to reach their expenditure limits. However, for teenagers who do not have bank accounts and will be tempted to take loan, co-branded prepaid cards are the right option. So make the right decision today in accordance to your needs!. Check here for free reprint license: Debit Cards Vs. Prepaid Cards - Which Should You Choose?.
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