The Cost Of A Pre Pay Credit Card:

Pre pay credit card is an alternative to credit card and debit card. Here, you need to load the pre pay card with any specific amount and then use it to make purchases or pay the bills.

There are certain costs attached with pre pay cards. Moreover, several financial companies have introduced their pre pay cards and the cost of cards also varies from one company to other. You need to consider the cost on pre pay credit cards before planning to choose the right type of card according to your needs. The cost that pre pay cards carry is segregated as below:

Loading fees: Some companies charge certain amount of fee each time you load money in your card, while some may not.

Upfront fees: When you visit any financial company to buy a pre pay card you will be required to pay the upfront fees. The upfront fees may also vary from company to company. For instance, the upfront fee of Post Office travel card in UK is £10 and that of Splash card is £ 6.99.

Other Costs Involved:

Monthly fees: Pre Pay cards also carry monthly fees or maintenance fees. The monthly fee of Cash Plus pre pay card is £ 4.95 and in case of a 360-money card, and £ 1.99(for premium card).

Transaction fees: Whenever you use the card, the company deducts certain amount from your card. It may depend on the percentage of total amount that you spent or flat rate (flat rate is the sum, which remains constant regardless of the amount that you spent). For instance, the transaction fees on Western Union Travel pre pay card is £ 1 for every transaction.

Next, the loading charges also depend on the amount that you credited in the card. Pre Pay cards such as Bluecorner will charge you £ 1 to load amount between £ 20 to £ 30. The loading charges may rise to £ 3 in case you credit above £ 100.

If using ATM: In case, you intend to use ATM, then pre pay card issuers will charge you with certain amount every time you withdraw amount from an ATM outlet.

Using Foreign exchange: If you wish to use a UK pre pay card overseas, then you will be charged with specific sum. It may be around 2.75% or 4% depending on your transaction amount. If you are using a travel pre pay card such as eorozone in your own home country, then you will not be charged according to foreign exchange.

Overview:

Sometimes, using pre pay cards can be more expensive than using credit cards or debit cards. However, the biggest benefit of such cards is that you cannot fall into debt. These cards are ideal for students or travellers, who cannot open a bank account immediately in UK.
Thus, in short, the concept of this card is same as that of pay as you go phone. You can talk as long as there is sufficient balance in your phone and as your phone balance gets over you need to refill it to continue talking.

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Tags: Accounts, Bank, Banking, Current Account, Money Management, Pre Pay, Savings, UK Credit Cards