Prepaid Credit Cards information resource

After the recession, many consumers have found it incredibly difficult to get accepted for any credit and debit cards. A less than perfect credit history often means that many people have been forced to look at other ways to get the money that they need. Banks and lenders have become stricter with their lending criteria and more people than ever before are being refused credit cards. Prepaid cards are one way in which people can control their money without getting into further trouble.

The rise in popularity of prepaid cards has left fraudsters unable to con people out of thousands of pounds. Even if a fraudster was to get hold of the card, they would need the chip and in to buy anything offline or to withdraw money. They would also only be able to spend whatever is on the card. For many people they do not keep a lot of money on the card at any one time.

It is estimated that around 20% of Britons are targeted each year by fraudsters. Only two credit card companies currently offer specialist protection against ID theft. There is no guarantee that you will get the money back if it is stolen. With a prepaid card it gives you the peace of mind that even if you lose your money, it will not devastate your finances. Credit cannot be obtained and once the money has ran out the fraudster would have to use their own money to top it up again.

There is a downside to prepaid cards over bad credit credit cards however. If your card was to be stolen, with a credit card you would be legally entitled to some form of protection. With prepaid cards there isn’t any protection that you are legally entitled to. This is mainly because it isn’t tied to a bank account. There will be no paper trail to follow due to the fact that most people use them to shop online. This makes it difficult to trap the fraudster.

While you are better protected against the risk of debt with a prepaid card, it is recommended that you only ever top up the amount that you need on the card. That way if it does become stolen, you will not lose a lot of money. You are still not fully protected against ID fraud with this type of card either. Depending upon which method of payment you use to top the card up, a fraudster could get your details from a statement. They can then use this information to apply for credit and debit cards in your name.

Overall the recession has forced more people to apply for alternative options such as the prepaid card. This has made it a lot more difficult for fraudsters looking to carry out identity theft. While prepaid card owners may not be 100% protected, they are still better protected against debt than a credit card user. There are many benefits to prepaid cards and this is just one of them.