Welcome to the world of prepaid cards by MasterCard

This information has been prepared to help you find out more about prepaid credit cards and how you can use them best. Although they're relatively new, prepaid cards are becoming more and more popular.

Many stores offer ‘prepaid gift cards' - you may have already used one! But prepaid payment cards aren't just limited to gift cards. There are prepaid cards for everything, from sending money to family and friends, to managing travel funds, to shopping over the Internet.

Independent research tells us that, by 2010, people across Europe will collectively have around 360 million prepaid payment cards in their pockets at any one time. With so many cards likely to be around in the future, the prepaid payment cards team at MasterCard Europe want to ensure that as many people as possible know what to look for when choosing a prepaid card that's right for them. This leaflet underlines our desire to help all consumers make an informed choice. We hope that you find it both reassuring and useful.

Prepaid cards an introduction to what they are

A prepaid card is a payment card that can be loaded with money by you or someone else. A prepaid card looks just like a normal credit or debit card, with a card number, signature strip and company branding. But prepaid cards are unlike credit cards, which provide you with a line of credit. Cards are usually a Prepaid MasterCard Visa or Maestro card

They are also very different from debit cards that are linked to a bank account with an overdraft facility. This is because you can't borrow money with a prepaid card - you can only spend the money you have loaded onto it. As your prepaid card is a MasterCard or Maestro card, you can use it anywhere in the world that accepts MasterCard and/or Maestro.

How prepaid cards work –Without the technical bits

You can use a prepaid card in the same way that you would use a debit or credit card. It's easy to use your card. To buy something, this is all you need to do:

• At the shops - Simply hand your card to the salesperson at the till
• Telephone shopping - Read out the card details over the phone
• Mail order shopping - Complete the order form, including the card details

Internet shopping - Input the card details at the ‘check-out' step of your Internet purchase. When you use a prepaid card, the money is immediately taken from the amount loaded onto the card - not from a line of credit or a bank account. As long as you have enough money available, you can continue to use your prepaid card to buy what you need. When the amount remaining on your card is low or at zero, you may be able to reload (or ‘top up') your card in a number of ways, such as:

• Cash top-up at post offices or convenience stores
• Funds transfer from a bank account
• On-line through an Internet account

Please check with your card provider for details.

What you need to get a card

You may need to provide proof of your identity and your address when applying for a prepaid card - but that's all. There are no credit checks or any other information that you need to provide. Once you have been given or sent your prepaid card, you will need to activate the card by following the instructions from your card provider.

When you buy a ‘prepaid gift card', you don't usually need to provide address or identity details. These cards may be given to family and friends, who can then use the card like a gift voucher, until the money loaded onto the card has been spent. This type of card cannot be re-loaded.

Choosing a prepaid card

There are many types of prepaid cards for you to choose from. Look at the features of each card and consider those, which are important to you, such as on-line account management, the ways in which you can reload the card, and the availability of additional cards on the same account. It makes sense to choose a card that has low fees and charges for the way in which you want to use the card most.

For example, if you just want to use a prepaid card for traveling abroad, a card that has low foreign exchange fees and overseas charges is likely to be the most appropriate. Shop around to find the card that has the best deal for you, and then compare the features and benefits on offer.

See our range of available Prepaid MasterCards >>

Ideal solutions

A prepaid card is an ideal solution for you if you:

• Want to give someone a gift - a Prepaid MasterCard or Maestro prepaid card is more widely accepted than vouchers or store gift cards.

• Are you traveling abroad and don't want to carry cash or traveller's cheques. A prepaid card is more secure because it can be blocked if it's lost or stolen.

• Want to help younger family members learn about managing their money. They can only spend as much money as is loaded onto the card, and the spending can be viewed on-line.

• Want to manage your money by separating it into different places for different purposes. You could have one card for everyday shopping, one for travel, one for on-line purchases, etc.

• Are you having difficulty opening a bank account or getting a credit or debit card for some reason. You don't need to pass a credit check to get a prepaid card.

Things that a prepaid credit card may be used for

• Everyday shopping

• Internet shopping

• Mail order and telephone order

• Topping up your mobile phone

• Paying bills

• Paying monthly subscriptions

• Withdrawing cash from ATMs

Benefits for MasterCard cardholders

Convenience

• Prepaid cards can be used wherever MasterCard and/or Maestro cards are accepted

• Anyone can get one – no need for credit checks or a credit history

Money management

• Can help you budget your money

• No interest charges on the card

• There is no danger of going overdrawn on the card. Once the money loaded onto the card has been spent, you can't spend any more until you've reloaded it

Security

• Carrying a prepaid card is safer than carrying cash. The card can be blocked if it's lost or stolen.

Prepaid cards are available from a variety of companies and locations. Some of the places that you can get prepaid cards include banks, over the Internet, and at participating retailers.