Prepaid Cards

What are prepaid cards?

Think of them like pay-as-you-go mobile phones. You can't spend beyond £0, forming a 'safe' barrier if you tend to overspend.

Another bonus is that you won't get credit-checked when you apply, making the application process much simpler. They're a good option for those who have just moved to the UK, or have a bad credit history.

Some people worry they may not be able to use a prepaid card in a lot of places. But most prepaid cards are Mastercard or Visa, meaning just like credit or debit cards, they're accepted by most retailers in the UK and abroad.

Who are they for?

If you struggle with budgeting, then a prepaid card may work out cheaper instead of accidentally dipping into a pricey overdraft on a regular basis.

You'd spend as you normally would using a debit or credit card, but you don't have to worry about missing out on perks – some cards also offer cashback and discounts on well-known retailers.

Should I get a prepaid card?

For most people, getting a normal credit or debit card will be the sensible financial decision, but it all depends on why you want the card.

It could be a useful tool if you're on a tight budget as you can only spend what you've loaded onto the card. If you're a parent wanting to teach the benefits of money management to your child, it might also be a good option. Or if you want to stay safe online, you might opt for a prepaid card.

But in a nutshell, whether you should get one boils down to one thing – how financially attractive you are. If you can easily sign up for a credit card, and you have the discipline to pay it off IN FULL, every month – do that instead.