There are many payment options available to consumers today. Amid the world of plastic money, two cards, which have a great similarity between them, are debit and co-branded prepaid cards. These two cards can often confuse users and make them uncertain about which one to opt for. If you are facing a similar dilemma, keep reading to discover some facts about both of these cards:
Issuance of Credit As prepaid cards are a means of using one's own money, no credit is issued with the use of this card. You can simply load your money and use it via a co-branded prepaid card, all over the world. On the other hand, although debit cards allow bank customer to withdraw amounts from their own accounts, there may be an overdraft facility provided by some banks.
Is There A Credit Check? Customers are not charged with any credit check before the issuance of prepaid cards. However, credit checks are performed by the banks for debit cards to verify customer's credit score and ratings before they issue them.
Cardholder Eligibility in Terms of a Credit Check It seems that banks issuing prepaid cards do not make their customers suffer much. There is absolutely no credit check. When it comes to debit cards, on the other hand, they would go for one to certify that their account holder does in fact have the right credit score and rating.
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.
Customer Information The issuance of a debit card requires the complete background details and information, regarding the bank customer. On the other hand, prepaid cards can easily be issued with very little and basic information about the customer.
ATM Usage Although debit cards can be used at ATMs, the same cannot be said for prepaid cards. There are very few prepaid cards, which have this facility available of being able to withdraw money from your account via an ATM.
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.
For the people with a bank account already opened, the better option is Debit card as they will spend within their expenditure limits. However, for individuals with no bank accounts who will be tempted to exceed their expenditure limit, the best option is co-branded prepaid cards. Now you can make the decision as per your needs!
Issuance of Credit As prepaid cards are a means of using one's own money, no credit is issued with the use of this card. You can simply load your money and use it via a co-branded prepaid card, all over the world. On the other hand, although debit cards allow bank customer to withdraw amounts from their own accounts, there may be an overdraft facility provided by some banks.
Is There A Credit Check? Customers are not charged with any credit check before the issuance of prepaid cards. However, credit checks are performed by the banks for debit cards to verify customer's credit score and ratings before they issue them.
Cardholder Eligibility in Terms of a Credit Check It seems that banks issuing prepaid cards do not make their customers suffer much. There is absolutely no credit check. When it comes to debit cards, on the other hand, they would go for one to certify that their account holder does in fact have the right credit score and rating.
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.
Customer Information The issuance of a debit card requires the complete background details and information, regarding the bank customer. On the other hand, prepaid cards can easily be issued with very little and basic information about the customer.
ATM Usage Although debit cards can be used at ATMs, the same cannot be said for prepaid cards. There are very few prepaid cards, which have this facility available of being able to withdraw money from your account via an ATM.
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.
For the people with a bank account already opened, the better option is Debit card as they will spend within their expenditure limits. However, for individuals with no bank accounts who will be tempted to exceed their expenditure limit, the best option is co-branded prepaid cards. Now you can make the decision as per your needs!
About the Author:
Conclusively, co-branded prepaid cards are ideal for people who do not have bank accounts so far and will probably take to a loan to fulfill their needs. Others maintaining an account already and not wanting to overdraft their limits can simply go ahead in opting for VISA card program and debit cards. Be sure to act wisely.. Also published at Prepaid Cards Or Debit Cards - Which One To Select?.
No comments:
Post a Comment