Prepaid cards are cards that have on it an already pre-stored monetary value and have no attachment whatsoever with any bank account. They are unlike debit cards that have links to accounts from where money spent is deducted and it is also not like credit cards in which case money is borrowed from the issuer.
Unlike in debit cards, prepaid cards are not linked to any external bank accounts, and payments cannot go beyond the value stored on it. Another term for prepaid cards is stored-value cards.
Prepaid cards work exactly like the cards used for utility bills, when the fixed monetary value finishes, it could be disposed off or recharged with any other amount and reused. Issuing companies have them monitored with computers. The card's chops are engraved with some numbers, which are unique to the cards, this numbers are used to monitor them.
The card issuing company keeps track of the card through the use of computers and when the monetary value is finished, they are blocked immediately.
There are many types of prepaid cards but the most used are the closed system prepaid card and the co-branded prepaid cards.
Closed system prepaid card, this type of cards are issued by a merchant and is used strictly to pay for services rendered by the brand or items purchased and no other. These closed prepaid cards are usually not of huge value, and can be compared to gift cards.
The co-branded prepaid cards are the type of cards that are issued by banks in affiliations with one or more business merchants. These cards are to be used only with the businesses and the difference between this card and closed system prepaid card is the affiliation with the bank.
Closed prepaid cards are cards issued by a business enterprise to its customers and can only be used for payments pertaining to the business enterprise only.
Even when lost, the cardholder only get to worry about the stored-value which is usually not so much unlike in credit cards and debit cards where if lost, it is a major crises.
Another benefit prepaid cards provide is that, when they are issued, there is no need for a background check of the credibility of the holder. Even if the card holder is indebted to the bank, the card will still be issued to him or her. With prepaid cards, there is no need to sign pay off consent unlike with credit cards.
Bill Adams is a business strategist. He has been doing this for a few decades and now he works at a prepaid card section of a card issuing company. He thinks the use of co-branded prepaid cards is healthy for businesses and individuals.
Unlike in debit cards, prepaid cards are not linked to any external bank accounts, and payments cannot go beyond the value stored on it. Another term for prepaid cards is stored-value cards.
Prepaid cards work exactly like the cards used for utility bills, when the fixed monetary value finishes, it could be disposed off or recharged with any other amount and reused. Issuing companies have them monitored with computers. The card's chops are engraved with some numbers, which are unique to the cards, this numbers are used to monitor them.
The card issuing company keeps track of the card through the use of computers and when the monetary value is finished, they are blocked immediately.
There are many types of prepaid cards but the most used are the closed system prepaid card and the co-branded prepaid cards.
Closed system prepaid card, this type of cards are issued by a merchant and is used strictly to pay for services rendered by the brand or items purchased and no other. These closed prepaid cards are usually not of huge value, and can be compared to gift cards.
The co-branded prepaid cards are the type of cards that are issued by banks in affiliations with one or more business merchants. These cards are to be used only with the businesses and the difference between this card and closed system prepaid card is the affiliation with the bank.
Closed prepaid cards are cards issued by a business enterprise to its customers and can only be used for payments pertaining to the business enterprise only.
Even when lost, the cardholder only get to worry about the stored-value which is usually not so much unlike in credit cards and debit cards where if lost, it is a major crises.
Another benefit prepaid cards provide is that, when they are issued, there is no need for a background check of the credibility of the holder. Even if the card holder is indebted to the bank, the card will still be issued to him or her. With prepaid cards, there is no need to sign pay off consent unlike with credit cards.
Bill Adams is a business strategist. He has been doing this for a few decades and now he works at a prepaid card section of a card issuing company. He thinks the use of co-branded prepaid cards is healthy for businesses and individuals.
About the Author:
There are numerous prepaid card programs to select from nowadays, pick the most suitable for your business. Deciding to get co-branded credit cards for your business is definitely a good choice.
No comments:
Post a Comment