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If you need to make transactions on the internet or phone and don’t have access to a conventional credit card, a prepaid credit card can be a good option. Although they are expensive, with proper research, you can get a good prepaid credit card to serve your needs. Unfortunately, it cannot be used in some instances.

You can’t use a prepaid card to rent a car

When renting a car, a prepaid credit card will not be ideal. It is challenging to use a prepaid credit card to rent cars since most car rental companies in the US don’t allow its use. However, few accept the use of a prepaid credit card, but finding one is tricky.

Therefore, if you want plans, including vehicle rentals, it will be optimal for you to use a credit card issued by a bank, preferably one with American Express, Visa, or MasterCard logo. Most importantly, if you rent a car and use a prepaid credit card to pay, you will have to accept the insurance provided by the automobile rental company. This is because the prepaid credit cards do not provide insurance on rented cars.

For all other transactions like hotel boking and online transactions, you can use your prepaid credit card. In most situations, the merchants will not be aware that your card is prepaid.

What are the fees charged on prepaid credit cards

Like other credit cards, these cards also have monthly or annual fees. The fees vary from $12 per year for the American Express Self-Serve to more than $300 for the mPower Visa Prepaid Card and NetSpend Prepaid card. If you do your research well and shop around for the available options, you can easily minimize costs. Interestingly some of these cards offer some benefits which make the high charges worthwhile.

You can easily reload your prepaid credit card at a storefront or online. Depending on the prepaid card you are using, the transactions may be levied. For online purchases from abroad, currency exchange is necessary, and rates tend to vary.