What is a Prepaid Card?
Academy · 1 April 2020Revolut Contributor
What is a prepaid card, and how does it work? What are the benefits of a prepaid card, and what can I use it for?
In this short blog post, we’ll tell you everything you need to know about prepaid cards.
Prepaid card meaning
Using a prepaid debit card is a popular alternative to carrying cash. There are two types of prepaid cards: prepaid debit and prepaid credit.
With a prepaid debitcard, you can load the card with money from another account, and spend in the same way as a traditional debit card – up to the amount you have available. With a prepaid credit card (also known as a “secured credit card”) people tend to use it to establish or improve their credit rating – because the credit is secured by an initial “collateral payment” or “security deposit”.
Here, we’ll answer your questions about prepaid debit cards – the most common type of prepaid card.
Read more: What is a Debit Card?
What are the benefits of a Prepaid Debit card?
No need for cash or loose change:
With the increasing opportunity to pay with your (contactless) card for small and large transactions in the UK, there’s no need to dig around for change anymore. A prepaid card will do the job, and if you link it with your digital wallet – e.g. Apple Pay or Google Pay – you might not even need to use the card.
Ease of saving and budget control:
Monitoring cash-flow is one of the best ways to maintain a budget. If you’re running a tight ship and need to inject more financial discipline into your life, a prepaid card might help you manage your money more diligently. It allows you to get a real handle on what you have available to spend each week.
Note: With a Revolut account, you get access to our Budget Planner. You can set your own budget and we’ll calculate a daily spending limit for you to meet your goals. When you pay with your Revolut card, your balance is updated in real-time and you can get instant spending notifications.
Quick and easy transfers:
If you’re out of money, there’s no reason to run around searching for an ATM. Instead, you can simply transfer funds over from your digital Revolut account, or a bank account held with an external provider, to your prepaid debit card and continue spending. And with a Revolut account, you can send and request payments from friends and family easily – without the hassle of exchanging bank details.
Shop online:
You can use a prepaid card to shop online as well as offline. This means you can keep everything within the same budget, whether you’re hitting the high street or browsing your favourite online store.
What can I use a Prepaid card for?
This depends on the merchant. Provided your prepaid card uses a major payment network such as MasterCard or Visa, you should be able to use it in most shops, restaurants, and other venues. You can use a prepaid card for doing your weekly food shop, or for buying clothes online. The choice is yours.
How much can you load onto a Prepaid card?
This depends on your prepaid card issuer, and on the bank account from which you’re transferring your money. For information about load limits on your Revolut card, see the help section of our website.
Hopefully we’ve explained everything you need to know about prepaid cards in this blog post. We’ve written about a lot of similar topics, which you can check out below: