Of all of the debit and credit cards available, there aren’t any that are easier to understand than the pre paid debit card. They’re perfect for people who are just starting out, specifically for young adults and those who are trying to build or restore their credit. As such, they’re readily available from a myriad of different financial institutions, as they aren’t subjecting themselves to much financial risk on their end.
Pre paid debit cards work in a very simple way. The interested party deposits a certain amount on their card and use it as they see fit. Unlike credit cards, they can only use the amount that they deposit, not a penny more. As earlier stated, this has been viewed as a great way for those people who are trying to control their spending. Since you can’t spend more than that, you don’t have to worry about things such as overdraft fees and the possibility of going into debt.
However, it’s worth noting that there may be certain fees per transaction. This is something that’s considered the norm, but not exactly the rule. These days, you’re finding that a lot of different companies that are rolling some of these fees back. Also, it should be said that some of these companies are willing to waive these fees altogether if a person is willing to deposit a certain amount when they’re setting up their account.
Pre paid debit cards are absolutely fantastic for people who are trying to strengthen their knowledge of finances, as well as those who are interested in establishing themselves. While some are better than others, many of these types of cards can be beneficial, provided that a person does their due diligence to research their* associated fees and percentages.