- The Out-of-Control Spender. For people who have already had bad experiences with their credit cards, a prepaid card can serve as a useful and efficient way to budget spending and avoid acquiring new debts. With a prepaid card, you use your own money to buy things with many of the conveniences that a credit card offers, but without the dangerous potential for racking up debt. You, with the help of your paycheck, set your own spending limit.
- The Unbanked. A growing number of Americans either cannot — or simply choose not — to access traditional banking, including regular savings and checking accounts. If you are one of these people, a prepaid card might be right for you. Unlike traditional banking, a prepaid card has fewer requirements to acquire it and therefore can serve practically anyone; all you need is cash. The prepaid card opens the world of plastic payments without worrying about your traditional credit score, banking history, or credit record. However, these advantages come at a price.
- The Traveler. Going away on a trip abroad used to require getting to the bank and exchanging your currency for traveler’s checks so your money would remain safe from theft and only available with your signature and the showing of your passport. Today, credit cards are still a vulnerable target since high credit limits allow thieves to make a bigger profit off of this product. The prepaid card is limited by whatever amount you set on it beforehand and prepaid card providers offer a number of features to those who choose to use this product more often than the alternatives.
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