A prepaid credit card is one in which the card is opened by depositing money into the credit card for use. The limit for these cards is simply the amount of money deposited into the credit card account. Usually credit card holders feel more secured by using this type of card because they can max out the balance or the credit limit and know that it’s their own money they are spending and at the end of the day they don’t owe any one, whilst still enjoying the benefits of a credit card.

With the prepaid credit card there are no bills and no interest charges however there is usually a set up fee and this amount varies. Once you spend the amount you deposit into the credit card, you cannot make additional purchases until you make more deposits into the account. It is very similar to a normal debit card attached to a savings account.

Prepaid credit cards are usually favoured by people who have bad or poor credit rating and they cannot obtain a post paid credit card because of the risk attached to them from their credit history. The criteria in obtaining prepaid credit cards are less stringent as other credit cards. There are many reasons why to choose a prepaid credit card. They are safe meaning that they are protected from unauthorised transactions if the card is lost or stolen, just like the regular credit card. They are also effective and convenient by allowing your spending limits to be controlled and are accepted worldwide wherever visa and MasterCard are accepted.