Citi prepaid credit card?

Question

I saw an ad once for a 'prepaid credit card'. Sounds just like a debit card to me. Is there really any difference? What's the point?

Answer 1

A prepaid credit card is something like a cross between a credit card and a debit card.

Like a debit card, you do have to put down money up front to open the account. However, like a credit card, it does have to be paid each month, and -- most importantly -- it does contribute to your credit history, meaning that regular payments are reflected in your FICO score.

It works like this:
1. you open the account with a credit company with an initial deposit of, say $1,000.
2. you charge $200 just like you would with a normal credit card.
3. at the end of the month, you receive a bill (really a statement) showing your charges.
4. a) you pay the $200 to replace the money in your account, and the account stays valid;
4. b) OR you don't pay up on time, and your credit history is damaged but, instead of charging you 30% interest, the credit company returns the remaining $800 credit that you had.

Prepaid cards are great for establishing a good credit history to avoid high interest rates when you do get a "real" credit card.

Answer 2

Credit cards are not restricted to a geographical distance from a bank branch. you'll apply for a master card from Citibank and simply mail in your payment after you get your statement. you'll be qualified supported your credit, not wherever you reside in proximity to 1 of their locations. after getting the card what will yo do? just visit source box to know how to log in your Citi Credit cards.

Thank You

Answer 3

A prepaid credit card is just that. It allows you to use your own money to fund the card, giving you the convenience later if you don't have the cash on hand. It is similar to a debit card. Although you fund the card yourself, it doesn't come directly from a checking account like most debit cards.

The point of these cards is to provide convenience to the consumer, without racking up unnecessary debt and interest by using a regular credit card. There are many purchases made online that accept only credit cards. You can use debit cards the same way, but there are limitations made by your bank that restrict the amount you can spend on your debit card per day. If you wanted to make a large purchase online, four plane tickets to Australia, for example, it is likely that your debit card will reject the transaction. Instead of increasing your consumer debt by using a regular credit card and compiling interest, a prepaid credit card is a great way to make these large purchases without being charged interest.

Answer 4

I'm not sure what you saw so I'm going to guess. Probably what you saw was a credit card for people starting out or re-establishing their credit. Some of these credit card offers, because of the little to no credit history or bad credit history help you re-establish your credit by offering you a secure credit card.

Secured by a bank account that you open with them, limiting your available credit to the amount in the account. Therefore, if you have $500.00 in a savings account (it's almost always a savings account that you open with the company offering the secured credit card) than you will have a $500 credit limit. That might explain what you meant when you saw a pre-paid credit card.

Another possibility, is for someone who might want a credit card for their young adult children and by limiting it to a pre-paid amount, can therefore help their children stay on a budget. I hope this answer helps.

Answer 5

it is similar to your debit card but you cannot go over the amount that you have prepaid. If you put 20.00 and make a purchase for 20.50 it would decline. Your debit card would normally allow you to make the purchase and charge you an overdraft fee.

Answer 6

Any pre-paid card is a DEBIT card....they are just like a c/c but once the moneys gone its gone....But..they are just as good for motel reservations Car rentals..Etc..B/c they have the Visa/Mc label on it

Answer 7

Well we don't have anything like this in india .... but I guess its juss the way u use Debit Card

Answer 8

you put money in the credit card and spend it, when put more money in when u done.

Answer 9

NO BILL