Terms and conditions of a prepaid credit card can be rather boring and tedious to go through irrespective of the product or service that they have been written for but it goes without saying, it is quite important to read the fine print before you sign on the dotted line.
As with other products, you do need to sign an agreement electronically and accept terms and conditions as set out by the prepaid card provider when applying for a prepaid card. If you are applying for a prepaid card using a form, then the terms and conditions would probably be mentioned on that form itself.
Typically, if all else fails, you should be able to find these terms and conditions on the prepaid card provider website. Areas within the terms and conditions that require you to pay special attention include the following.
- Card Cost: Is the card free? If not, what is the cost?
- Validity Period: what is the Validity period of of the card? How long before it expires?
- Monthly Charges: Is there a monthly service charge, and, if so, what exactly do you get for it? Would it be better to get a pay as you go prepaid credit card instead?
- Usage Fees: what are the fees for using your card? There are cards which charge nothing for local POS transactions. They might be a better bet.
- Top Up Fees: What are the fees for loading your card? Some top up and loading options are free. Use these options.
- Customer Service Setup: what are the fees for contacting customer services? Some sneaky providers can charge up to £1.00 per call that you make to customer services. Avoid, if possible.
- Usage Restrictions: Any clauses regarding restrictions on the usage of your card. The majority of prepaid cards cannot be used to hire a car or at certain prepaid parking lots, etc. Know the restrictions before the card fails to your embarrassment.
- Account Closure Fees: Is there a charge for closing your account?Some providers charge £10-£20 for closing an account
- Card Replacement Fee: Will you be charged for replacing the card, in the event that it is lost or stolen?
- Card Renewal Fee: Do you have to pay a fee each time the card is renewed (i.e. upon reaching the expiry date)?
It is quite easy to assume that Terms and conditions would tend to be standard across the prepaid card industry but that is definitely no longer the case as the industry grows with over a 100 products to choose from in the UK market alone. That basically means that terms and conditions are still worth reading especially to ensure you are aware of the items above and are able to find the best prepaid card to suit your needs.
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