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A free prepaid debit card is a viable alternative to a credit card. If you are looking for a mode of payment which can save money and also help you manage your finances, then you can go for free prepaid debit cards. Prepaid debit cards are easier to apply compared to credit cards. If you are an employee of a business organization, you are given a free prepaid debit card. You often get these cards free as a promotional move also.

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Free prepaid debit cards require no employee verification, bank accounts or past record of credit history. There is no credit line attached, so there is no worry about going past the credit limit and getting involved in a bad credit situation. You can manage your finances well and your overspending habits are curbed. Here are some of the 5 tips which can help you choose a free prepaid debit card wisely:

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1. World wide acceptability: Most free prepaid debit cards are accepted at locations and shopping outlets which display the logo of the debit card company. However there may be some places and shops where which your free prepaid debit card may not be accepted. Make sure that you thoroughly know about the acceptability of the card in most of the locations you will be shopping or using the card.

Prepaid cards are electronic cards which allow card holders to access funds deposited to an account. A prepaid card can be used to withdraw money or pay for goods and services. Unlike a credit card, which extends a line of credit, prepaid cards are more similar to debit cards. Prepaid card holders can only spend the money they load on the card. Since no credit is extended to prepaid card holders, interest and overdraft fees are avoided.

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2. Convenience: A prepaid debit card is just as convenient to use as a credit card. You should however know if you can use the card for online shopping and purchasing items over the phone. You can read the fine print of the free prepaid debit card company or find information from its website about the terms and conditions if any, of the usage of card online and for transactions over the phone.

Prepaid cards can be used anywhere that debit or credit cards are accepted. Some establishments even prefer prepaid cards over credit and debit cards because they assure vendors that funds are sufficient. Since prepaid cards are protected by a secure PIN number, they can be used to withdraw money from most ATM machines.

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3. Value added services: Your free prepaid debit card company should give you different value added services like sending your statements online or through the mail to your home or office. Some prepaid debit cards also notify you about the salary credited to your account, on your cell phone itself. Choose a debit card which can transfer funds from one debit card to the other without any problems. You can also choose a customized card where you can emboss your name or photo. Check with the debit card company if you have a certain amount for the customization.

Money can be loaded on to your prepaid card by cash, bank transfer or even another credit card, and because it is a Visa or MasterCard you can use it anywhere in the world. Prepaid cards generally have the same uses as a credit card, so much so that they are commonly referred to as ‘prepaid credit cards’. However, there is a difference. A prepaid card is completely powered by your cash and therefore the money you have in your prepaid account is the money you have to spend. This means there is no risk of running into debt. There are no credit checks and no interest to pay. Consequently, rather than referring to it as a prepaid credit card, a better description would be a prepaid debit card, a prepaid Visa card or a prepaid MasterCard.

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4. Insurance: Choose a prepaid debit card which gives you insurance against loss, theft or damage to the card. You should be reimbursed for any funds that are taken out of your bank or debit card account when the card is stolen.

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5. Terms and conditions: Though it is stated that a free prepaid debit card does not have any fees, you may be charged for things like card renewal or replacement of the card lost or damaged. You may be also charged a certain fee if you withdraw cash from the ATM for more than a certain number of times in day. Also a free prepaid debit card is offered as a corporate salary account by big corporate companies to their employees. After you leave the organization, the bank notifies you that the corporate account will be converted into a current account with your permission. You will be required to keep a minimum quarterly balance or so in your debit card account, otherwise you will be charged a certain amount of fee for non-maintenance of the minimum balance. You are also charged a transaction fee if you use the free prepaid debit card to remove cash on your account from the ATM location of another debit card company or bank. Find out if the above conditions are attached with your free prepaid debit card and to what extent you are liable.

Active Credit Credit Guide Daniel Cohen recommends Find Credit Cards for comparing different free prepaid debit cards.

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