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I would like to apply for a Kroger prepaid card, but I don't understand exactly how it works. What is a prepaid card, and is it really different from another type of credit card?
Answered on September 17, 2016 Updated on September 17, 2016
The content is accurate at the time of publication and is subject to change.
Many people have trouble understanding the distinctions between a prepaid card and a regular credit card. But the difference is pretty easy to see, once it's explained. With a credit card, you are issued a line of credit which you can borrow against, but which you will have to repay. With a prepaid card, you load your own money onto the card initially, and then use it up when you make purchases. You can never go into debt using a prepaid card, because you are simply using up your own money. When it's gone, it's gone. There's nothing to pay back. A prepaid card is much more similar to a debit card than to a credit card. And in fact, many people use prepaid cards instead of having regular checking accounts. Many low-fee prepaid cards are available, and they are a great option for many people.
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BROWSE MORE QUESTIONS ABOUT Prepaid & Debit Cards:
A prepaid card is a payment card that you load with money before you can use it for purchases. Prepaid cards may look like credit cards, as they may have numbers, your name and Visa or MasterCard logo. But prepaid cards are different - you are not borrowing money, you are spending money you loaded onto the card in advance. Prepaid cards give you convenience of electronic payments.
ReadyCARDs are issued by Metabank and are prepaid cards. It means that you can use anywhere them debit cards are accepted, including ATMs. ReadyCARDs work similar to debit cards, except that they don't carry a credit line, you will not be charged interest, or late fees. You pay as you go by pre-paying the amount you wish to spend, plus additional usage fees.
On the other hand, a credit card gives you a credit line meaning that you may purchase now and pay off later up to the amount of your credit limit. You also have to pay the minimum payment each month until the due date or you may be...
Pre-paid card can be great for this sort of thing. AccountNow® Prepaid Visa® Card has an one-time activation fee $4.95. This card comes with $0 monthly fee, but you should clarify further this information in the cardholder agreement on bank's site.
When you choose prepaid card, pay attention of what fees are associated with the card. Some cards charge maintenance or other fees. Some pre-paid cards allow the holder to withdraw the cash which means you would not be able to track what the money was spent on.
Have you ever been declared bankrupt or defaulted on a loan?
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