Debit Cards – Your Bridge To Good Credit


Have you been denied for a credit card because of your credit status?

If you suffer from bad credit history, a prepaid debit card may just be the tool you need to rebuild your credit. In this article, let’s see how debit cards work and how exactly they can help in rebuilding credit history for people with poor credit scores.

Prepaid Debit Cards – How they Work

Prepaid debit cards are very much similar to regular credit cards in the sense that you can use them for payment instead of cash. The big difference between prepaid cards and credit cards is the credit line.
Prepaid cards do not provide a credit line so the holder can only use the card as long as there are sufficient funds deposited in his account. The expenses charged to a prepaid card are paid immediately using the cardholder’s available fund. Hence, prepaid cards do not require pay back.

Secured credit cards on the other hand require the submission of security deposit from the account holder. The amount of security deposit will determine the credit limit that would be given to the secured credit card holder. Security deposits may range from $300 to $1,000 depending on the issuer. Meanwhile, prepaid credit cards do not require a security deposit so you can still get one even if you don’t have the available cash.

The Benefits of Debit Cards

Some people may feel that prepaid debit cards are just like wallets because it doesn’t provide advance purchasing power like credit cards do. Nevertheless, prepaid cards are a safer way to shop with rather than carrying cash. If you’re shopping from the internet, a prepaid card also provides safety since it isn’t connected to your bank account. If you’re planning to buy something from the web, deposit a limited amount that’s just enough to pay for that one purchase.

There are prepaid card issuers who offer credit reporting to the major credit bureaus and these are the ones that can be used in rebuilding bad credit. If you can’t get a credit card at this time, why not start by opening a prepaid debit card account and work on improving your credit?

Another great thing about debit cards is that it can help put your spending under control. The limitations of debit cards such as not having a credit line may work out to be a benefit after all, especially for people who have trouble with their spending habits. Prepaid cards are likely to lessen the tendency to splurge since you can’t get credit.
Debit cards offer convenience and flexibility. Most debit cards carry a MasterCard or Visa logo so you can be assured that your payment will be accepted in wide variety of shops and establishments anywhere in the world.
True, prepaid debit cards have come a long way since they were first introduced to consumers in the 90s. Today, prepaid cards are equipped with more useful features and can even be used to improve bad credit. Find out more about debit cards from popular debit card issuers and find out how these special cards can help you.


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