Prepaid bank cards - what is it in simple words

• Posted by Ted Reddit August 12, 2022 Filed in Other 195 views
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  Recently, the unfamiliar term "prepaid card" has been appearing more and more often in the financial sphere. An untrained customer is unlikely to find the difference from the standard and customary plastic.

   

  Nevertheless the unique payment product has several key differences from the standard one. You can read about what a prepaid payment card is, how it works and how your company can get one at https://wallester.com/cards/prepaid-card.

   

  How is a prepaid card different from all the others?

   

   

  Credit institutions issue two types of plastic - limited-limit credit cards and debit cards. But there is a third type of plastic - prepaid cards.

   

  Many customers confuse them with debit cards. But according to the regulations, prepaid cards should be considered as an independent instrument, which works strictly according to the set rules. A prepaid card is a payment card not tied to a payment account or a credit line.

   

  The card got its name for the key difference in the processing procedure. As you can understand from the name. When drawing up the plastic, the applicant needs to deposit a given amount on the personal account, which is then displayed on the balance of the card.

   

  
  

  To issue a card, you need to do the following steps:

   

  It is necessary to submit an application to the organization for the issue and further maintenance of the plastic.

   

  The payment considers and approves the submitted application.

   

  It is necessary  to specify the amount to be placed on the balance of the plastic.

   

  It is necessary  to deposit the amount on the account of the opened card and only after that the payment issues the plastic and hands the card to the client.

   

  Such cards can not be named, so anyone can use them. Moreover, there is no need to enter a pin code. The payment only services the card; therefore, there is no card account assigned to the plastic. The credit organizations, which issue prepaid cards, keep one joint account, which allows all the cards of this type to work stably.

   

   

  The card is convenient because the company can periodically replenish the balance of the plastic and use it at his discretion. The financial institution will not open a credit limit and will not demand a fee for the use of their product.