Disadvantages of prepaid debit cards
Posted on 18. Sep, 2009 by admin in Credit
Prepay debit cards have the following demerits:
Ø     Sometimes, the charges imposed on debit cards are too high. You have to make payments initially to purchase a prepaid debit card. Also, to reloads funds, to increase the limit, to withdraw cash and to cancel the card, you need to pay fees.
Ø     If the PIN is not frequently changed or if you reveal it to someone by mistake, it may be misused. Hence, it is risky to own a prepaid debit card if not kept carefully.
Ø     Prepaid debit cards must be used wisely. As it is not burdensome to reload funds, you may lose track of how much you have spent and may overuse it. You should keep in mind that you can use it only until you have cash to reload funds.
Ø     It costs approximately $5 to refill your debit card. Hence, initial funding and the amount of money you use to reload should be high enough.
Ø     Since different debit card issuing companies demand different amounts of fees, a lot of ground work should be done before signing up for a prepay debit card.
Ø     The security protection for debit card holders is less than that for credit card users in many countries.