So what is prepaid credit card?

It is a type of card with a stored value. It is something just like a debit card, but it is not linked to your personal bank account.

In fact – this type of cards are becoming popular in recent years, because many people use it as a budgeting-tool. By putting in a certain amount of money on the card, they could not spend more than the designated amount.

Remember – this works just like any other visa or master cards for making purchases. However, you must have enough money in the pre-paid account in order to cover your purchase or it will be declined.

So, what are the benefits of having this card? It is this…

1. It is one of the best ways to protect from credit card thefts. As there are many fraud cases occur every day, it is smart to use the prepaid system. The reason is because with prepaid, we need to deposit money into the card; and usually we will deposit lesser fund on the card. If frauds occur, our losses would be minimized.

2. If you lost your card by any chance, you could easily transfer your prepaid money into other account immediately. In result, you could still assure of having your money.

3. People who could not be able to get approval by the secured cards (such as Visa or MasterCard) due to poor credit; they could simply apply for prepaid credit cards. It will help them to solve their financial problems immediately. Therefore, prepaid cards provide a secure, sane and uncomplicated solution to the worries of frauds and financial complexities.

If you a frequenter of payday loans, you’ve probably pondered this question: can I be arrested for default on payday loan? The simple answer, no. There is no law that allows you to be arrested for not paying off payday loan debt. In fact, according to the Fair Debt Collections Practices Act (FDCPA), it is ILLEGAL for a lending institution to threaten a person with the possibility of being arrested for non-payment of a debt.

No matter how many threats you receive about being arrested or charged with a crime, it’s not going to happen, period. If a person could be arrested for defaulting on a payday loan, the court systems would be twice, if not 3 times, as jam packed as they are now. Luckily though, that is not the case, so stop worrying about being arrested for defaulting on a payday loan!

Unfortunately, that is but one worry out of the way; there are many others lining up the longer you continue to avoid repayment on your payday loan.

What type of worries are there? Well, the rapid increase of fees & penalties for one. The longer it takes for you to pay off the debt, the more fees and interest that will accrue. These additional fees and interest are going to increase as time goes on, making it exponentially more difficult to pay off the payday cash advance loan.

Aside from the additional fees, there is also the matter of your credit score, which will begin steadily declining as the cash advance loan remains unpaid. The larger the loan and the longer the debt remains, the harder the hit will be to your credit rating. If the cycle continues and you are continually late with your payday loan payments (or if you don’t pay them at all), your credit score will be in the toilet within just a few months time.