Prepaid Debit Cards vs. Secured Credit Cards: What's the difference? Most people assume they are the same, but there are some striking differences. While they both offer guaranteed approvals, requiring you to use your own money for deposits, there are some striking differences. This article will help you assess your situation and determine just which card is right for you.
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Secured Credit Cards:
- Your initial deposit serves as your line of credit
- You have to pay back the money in monthly installments
- You are charged an interest rate
- Reports to the credit bureau and can help rebuild credit
- Can generally be used to rent a car or book a flight
- Deposit and spending limits
- Annual and monthly fees may apply
- No credit requirements
Prepaid Debit Cards
- An empty account where you spend what you load
- No monthly payments
- No interest rate
- No credit reporting/does not affect your credit rating
- Generally cannot be used to rent a car or book a flight
- You can only spend what you deposit onto the card
- You can load and unload the card at any time
- No credit requirements
Now that you know the difference between secured credit cards and prepaid debit cards, you will be better equipped to assess your needs, compare the costs and benefits and determine which card is right for you. For more information, visit: http://www.lowcards.com/comparing-prepaid-debit-cards-secured-credit-cards-13098