Compared to standard credit cards, this type of account is where the customers” accounts are debited before the services are offered. These accounts are usually assets. The options allow the clients to review, supervise and plan for the usage in advance.
For any client to use this method, he/she must have an active account. The prepaid credit card account is activated by putting money in the same account just like creating other normal accounts. Once money has been successfully deposited in the account, the owner is issued with a card. This is what will be used to withdraw or make deposits into the account. It is also used to identify the owner of the statement. The benefit of using this service is that the owner has the freedom to charge anything he/she wishes and never go bankrupt. This is governed by the fact that once he/she uses all the money in the bank, there can never be any more withdrawals until another deposit is made. No bills or any interest rates are charged.
Another alternative form of payment is the prepaid visa which allows the client to buy goods and services without the need of carrying cash and sometimes checks with them when they make their purchases. The advantage of using a pre paid visa is that there is no financial charges or any bill to be paid later since it is preloaded with monetary amounts; unlike in the other forms where a bill to be paid is later charged to a certain account.