For the most part, a prepaid credit card can be used just as any Visa, MasterCard or American Express credit card. The main difference is that a prepaid credit card allows you to spend only the amount that you have preloaded with the card issuer. In other words, you cannot spend what you do not own.

Prepaid cards offer a number of advantages:

• Easy approval – issuers do not need to check your credit history, so you do not need to worry about your credit score. Your approval is virtually guaranteed upon verification of your identity.
• Control – if the prepaid card is given by you to your children, for example, you can control how much they can spend and they cannot go over your limit.
• No monthly bills – obviously, prepaid cards are preloaded with money, so you do not pay any bills and you cannot incur any late payment fees.

While some of the disadvantages of using a prepaid card include:

• Prepaid cards will not repair your credit history – prepaid cards’ activity generally does not get reported to credit reporting agencies
• It is not a source of emergency funds – unlike credit cards, you cannot use a prepaid card as a source money in an emergency
• Additional fees – some prepaid cards may carry a number of different fees: card application fees, monthly maintenance fees, charges for balance loading, ATM withdrawal fees, inactivity fees, minimum required balance fees, to name a few

Features to pay attention to before you apply:

• What are the card fees?
• What are your reload options?
• Is online account management available?
• Can you have additional cards under the same account?
• Does the prepaid card issuer offer bill paying services?
• What are the minimum and maximum balance limits?

Below is a list of popular prepaid cards:
AccountNow Prepaid Card
Vision Premier Prepaid Visa Card
SilverCard Prepaid Mastercard