Best Prepaid Cards
A prepaid card is a reliable alternative to debit and credit cards. It is better for everyday spending alongside good financial planning and money management. But how does it work? How can you get a prepaid card? Also, what are the best prepaid cards to use today? In this article, we will answer these questions and show why getting a prepaid card is a wise decision.
What is a Prepaid Card?
A prepaid card is a physical or virtual card that you can use to make payments online or in person. It is not linked to a bank account. Instead, it comes preloaded or gets reloaded with money. The balance on your prepaid card determines your spending limit. In that way, it helps you avoid getting into debt. That is why prepaid cards are also known as stored-value or pay-as-you-go cards.
How does it work?
Typically, you need to add money to a prepaid card before you can use it. Still, some prepaid cards come preloaded by the issuer. Whichever the case may be, a prepaid card works like other cards in many ways. For example, when you want to make a payment, you can swipe or insert it into any point-of-sale system. You can also use it for other transactions, including money transfers and cash withdrawals at ATMs.
Types of Prepaid Cards
There are different prepaid cards, including reloadable, non-reloadable, open-loop, and closed-loop cards. They could also come as prepaid gift cards and prepaid travel cards. While some prepaid cards are for single-currency use, such as EUR or USD prepaid cards, others are for multicurrency use. We will now tell you more about the various types of prepaid cards.
- Reloadable prepaid card: This is also known as a general-purpose reloadable card. It allows the cardholder to repeatedly add money to it and perform many kinds of transactions. Most reloadable prepaid cards are open-loop prepaid cards. Hence, they have the logos of their respective major card-issuing companies or branding networks, such as Mastercard, Visa, Discover, and American Express. The cardholders can use them in stores at various locations where the services of the issuing payment networks are available or accepted.
- Non-reloadable prepaid card: This type of prepaid card does not allow the cardholder to put money on it after using up the balance. It usually comes pre-loaded by the issuer and is meant for a single or one-time use. Most prepaid gift cards are non-reloadable. Also, they come with shorter expiring dates than regular bank cards.
- Closed-loop prepaid card: This is also known as a single-purpose card. It can be used to make purchases at a particular store, between affiliates, or a group of retail businesses only. For example, Amazon gift cards and Starbucks gift cardsare non-reloadable closed-loop prepaid cards.
- Prepaid travel card: This type of card is for managing your expenses abroad. It allows you to add money in any currency onto it. Hence, it is a reloadable open-loop prepaid card that can come with single or multi-currency support. When the currency on the card is different from that of the host country, the interbank exchange rate is often used to facilitate payments. Prepaid travel cards are ideal for frequent travellers, expats, freelancers, and digital nomads. They allow them to enjoy attractive offers and deals from the partners of the issuing company.
How to Get a Prepaid Card
You can get a prepaid card from a traditional bank or neobank, a FinTech company, a credit union, or any other financial service provider. It is also possible to buy prepaid cards from retail shops and e-commerce stores. The cost of a prepaid card usually includes the initial load, which is the amount of money you want to add to it, and its price. There are also free prepaid cards on the market. Whether free or paid, some prepaid card issuing companies will require you to provide certain personal data for card registration.
Who can get a prepaid card?
You do not need a bank account or a good credit history to apply for a prepaid card. Generally, anyone who is not below the legal age (which is 18 or 21 in some jurisdictions) can obtain this kind of card. Hence, you must present proof of age, which could be an official ID or passport. However, there are also prepaid debit cards for kids and teens. Note that there may be a few other requirements to meet to get a prepaid card, which vary from one country or region to another. Nevertheless, it is usually easier to get a prepaid card than any other kind of card.
Best Prepaid Cards
Prepaid cards come with different features that enable them to be useful for various purposes. That is why it is helpful to decide what you will be spending on so that you can go shopping for the right prepaid card.
Here is our list of the 12 safest and most rewarding prepaid cards to use today.
VIALET
VIALET issues prepaid Mastercard debit cards to its customers for free. The cards are reloadable and for general-purpose use in over 200 countries. The cardholder will pay a 2% fee for every ATM cash withdrawal – the minimum charge is €2.5. However, the VIALET physical card is available to customers in Latvia, Spain, and Poland.
Intergiro
When you create a business account with Intergiro, you get the best dynamic prepaid card limits and controls. The physical and virtual Mastercard cards allow you to conveniently control your team’s spending, as well as freeze and cancel their cards when necessary. The cost of the physical card is 3 EUR per order, while that of the virtual card is 1 EUR. There is no monthly fee on any of the cards, and you can use them for general purposes, including business travel spending and digital advertising.
Soldo
Soldo offers prepaid Mastercard cards for business expense management. With its multicurrency prepaid cards, you get complete control over company spending. You can replenish the card for free and enjoy foreign exchange at 1% above the interbank rate when you make international payments. Soldo offers different prepaid products with unique benefits. The monthly fees are €6, €10, and custom pricing for the Pro, Premium, and Enterprise packages, respectively.
Ibandirect
Ibandirect offers a cash-out solution that comes with a dedicated crypto-friendly IBAN account and a prepaid card issued by Visa. It supports transactions in cryptocurrency and fiat money. To open a prepaid account with Ibandirect and get a prepaid card, you will pay a fee of €10 for the physical card or €5 for the virtual card. The monthly ATM limit on the card is €2500, while the service charge is €5 per month. IBAN account opening is free, but a cancellation or closure costs €15.
FairFX
FairFX issues a free multi-currency prepaid Mastercard card that can be used in more than 190 countries. The brand’s customers enjoy attractive rates in 15 major fiat currencies, which include the US dollar, pound sterling, and euros. You can earn not less than 3.5% cashback when you use your FairFX prepaid card at some of the best high-street retail stores in the United Kingdom. Moreover, travellers can get attractive deals and offers from FairFX’s international partners through the various smarter travel choices available to its cardholders.
Monese
Monese offers separate prepaid Mastercard cards for individuals and businesses for just 9.95 GBP monthly. Its new corporate customers can use the card to make six free withdrawals from ATMs per month. After that, the customer will pay 1 GBP for every withdrawal. Also, Monese provides multilingual customer support in 14 languages.
Walletto
Walletto provides virtual prepaid cards and reloadable plastic cards to create safe and easy online payments for businesses. The prepaid cards can be used anywhere Visa and Mastercard debit cards are accepted. Since Walleto focuses on collaborating with partners to issue cards, each partner will have a different price structure.
Crypto.com
Get prepaid Visa cards for fiat money and cryptocurrencies when you open an account with Crypto.com. You can top up your card using a bank transfer, debit or credit cards linked to a bank account, or a crypto card. The cost of using this card varies by country and card tier. When you apply for the Crypto.com Visa Card, you will see all the details about exchange rates and fees in the Terms and Conditions.
TTM Bank
TTM Bank offers prepaid Visa cards for easy payments, money transfers, and cash withdrawals. You can replenish your account with cryptocurrencies such as BTC, ETH, and USDC. Your crypto deposit will be instantly converted to fiat money (EUR). For every TTM Bank physical card you order and activate, 25 EUR will be paid to your account. Similarly, 10 EUR will be credited to your account for every virtual card you order and activate.
OWNR Wallet
Open an account with OWNR Wallet and use your balance to fund your Visa prepaid card. You can top up your card using fiat or crypto and spend cryptocurrency worldwide. The prepaid cards from OWNR Wallet also offer 24/7 virtual and ATM access to cardholders. In addition, you can get the OWNR prepaid Visa cards for your business. It is excellent for paying employees and controlling their corporate expenses. Besides, the fees are customisable, so you have nothing to worry about.
Crypterium
You can get a free prepaid virtual Visa card within 20 minutes when you create an account with Crypterium. The card simplifies your online shopping. Also, you can get a physical plastic Visa card for offline shopping with a monthly spending limit of €10,000. The plastic card can also be used for ATM withdrawals worldwide, with a limit of €2,500 monthly.
Paysend
You can use the Paysend Smartcard issued by Mastercard to make payments conveniently. It is linked to a multicurrency wallet that can hold up to eight currencies, allowing you to spend at almost no extra cost when travelling abroad. You can top up your prepaid account using a bank transfer, Google Pay, Apple Pay, or any other card. Should you lose your card, you can use the Paysend mobile app to freeze it to maintain total control over your account.
Capitalist
Capitalist issues prepaid physical and virtual Mastercard cards for payments. They can also be used for payroll management, employee spending control, and subscription to online advertising services. The cards support transactions in USD and EUR.
What’s the Difference Between a Prepaid, Debit, & Credit Card?
A prepaid card allows you to spend only the money loaded on it beforehand. And when you have used up the balance, you will have to recharge it or get another if it is non-reloadable.
A debit card is linked to your current or checking account and lets you spend the cash deposited in your bank account. Unlike a prepaid card, you can spend more than the balance in your debit card account if your bank gives you an overdraft.
Credit cards allow you to borrow money to make payments, but with the promise that the card provider will get the funds back. In most cases, credit cards have spending limits and require the cardholder to pay interest periodically. Unlike prepaid and debit cards, credit cards do not require an advance cash deposit into your card or bank account. Also, you do not need a current account to have a credit card. To determine whether they can issue you a credit card, banks and credit card companies usually collect information about your present employment status, income level, and credit score.
Therefore, while prepaid, debit, and credit cards are all for making payments, the main difference between them is in their requirements. You can get any type of prepaid card without having a good credit score—which is required for a credit card; or a bank account with a cash deposit—which is necessary for a debit card.
Prepaid Card Fees
When searching for the best prepaid cards, you need to look at the various fees. Your goal should be to get a card that is not expensive. These are the most common prepaid card fees and charges:
- Application fee: This is also known as a set-up fee. It is the amount you pay for obtaining your prepaid card. Some card providers do not charge this fee.
- Transaction/withdrawal fee: Some banks and card-issuing companies charge a fee for local/international transactions, including cash withdrawals from ATMs.
- Monthly maintenance fee: Most prepaid cards come with monthly fees for account maintenance.
- Renewal fee: Regular prepaid cards are valid for about three years like debit cards. Some card providers charge a fee for subsequent renewal.
- Non-usage charge: Some credit card companies will charge you a fee if you do not top up your account or spend from it within two months. It is known as the non-usage or inactive account fee.
Are Prepaid Cards Safe?
The answer is yes. The money on a prepaid card is safe. Besides, you can use the mobile app to freeze the card to prevent criminal access to your funds if you lose it. Prepaid cards are safer than cash. Anyone who wants to use the money on your prepaid card must know the PIN, but that is not the case with cash in a physical wallet. In addition, prepaid cards are more secure than debit cards because they grant access to the money you have preloaded on them rather than the balance in your current or checking account.
How to Cancel a Prepaid Card
If you no longer need a prepaid card, you can cancel it to avoid incurring monthly fees and non-usage charges. In that case, you will have to transfer or withdraw the balance money on the card. You can use a supported ATM to get the cash or transfer the money to a debit card linked to your bank account. When you have no balance left in the prepaid account, contact your card provider via email, chat, or telephone to cancel it.
What Are The Restrictions And Why do They Exist?
Some companies, such as e-commerce stores and advertising service providers, restrict the use of prepaid cards. For example, Amazon does not allow customers to combine credit cards with prepaid Mastercard, Visa, or American Express cards on a single order. Besides, some prepaid card payments to the company are unsuccessful because of issues such as insufficient balance and technical problems with processing the three-digit CVV codes behind the cards (bank messaging failure). Hence, the reason for the restrictions.
Furthermore, online advertising companies have certain limits on physical and virtual prepaid cards as payment methods. A few examples are the restrictions placed by Facebook (owned by Meta) and Google, which vary by the user’s country of residence and currency.
Alternatives to Prepaid Cards
Debit cards and credit cards are alternatives to prepaid cards. They similarly offer a convenient way to make cashless payments. You can use debit cards to make ATM withdrawals or spend money in your bank account. But with credit cards, you borrow funds from the card issuer to make purchases or cash withdrawals. Debit cards allow you to avoid getting into debt.
FAQ
The best prepaid card is the one you can easily afford for the purpose you have in mind. Since there are different types of prepaid cards, you need to do research to find out which one can help you achieve your financial goals. For instance, if you need a card for any purpose, use VIALET, Intergiro, or any other reloadable prepaid card listed in this article.
Most prepaid cards are very safe. They are even safer than debit cards, which may expose all your money to cybercriminals if hacked. With prepaid cards, you only risk the amount of money you deposit on them, not the money in your bank. Nevertheless, the safest prepaid cards include the likes of FairFX and Monese.
You can hardly find a prepaid card with absolutely no fees. In one way or another, the card-issuing company must charge some money for the prepaid services. You should look out for hidden fees charged by companies that promise absolutely no fees. Also, there are different types of fees that many card providers charge on their prepaid cards. They include card issuing fees, maintenance fees, reload fees, and others. Therefore, if you are looking for prepaid cards without certain fees, we recommend the following:
Yes! According to the law, all transactions made with payment cards, including prepaid debit cards, as well as third-party transactions, must be reported to the Internal Revenue Service (IRS) of the United States.
Yes, but it will lack many important features that most people need.
To get a regular prepaid card in the United States, you need to have a Social Security Number (SSN). However, temporary prepaid cards can be obtained without an SSN. They are not personalised to the buyer, cannot be issued with an account application, and are non-reloadable. Also, the temporary prepaid cards you can get without an SSN cannot be used for cash withdrawals at ATMs and do not work for money transfers. So, the prepaid card you can get without a Social Security Number is more like a gift card.
The Bottom Line
Prepaid cards allow people to manage their money conveniently and confidently. They help you avoid incurring debt by keeping you in complete control of your spending. Although they often come with various fees, you can also find many prepaid card providers that offer several free services to their customers. We have listed the best prepaid cards in this article. We hope that you will enjoy using them.
