prepaid cards - benefits? realistically what is the point?

mikesten

Plxply wrote: »

If you're 11 or older you're able to get a Visa Debit card from a majority of banks and couple that with internet banking you practically have a full account (minus overdraft). It really does puzzle me as to why people use these cards.

Consider that not everyone can even get a basic bank account. I had the old Natwest Step account that came with a Solo card, but needed Visa/Mastercard to shop online. I couldn't get a "normal" debit or credit card, and believe me I tried! I got a Cashplus card when they first came out (2005 I believe) and it was my main payment card until I was accepted back into the mainstream credit world in 2009.

Road_Hog

mikesten wrote: »

Consider that not everyone can even get a basic bank account.

Didn't NuLabour force banks to offer basic bank accounts, even if you had CCJs or bankruptcy? I'm sure most of them accepted you with outstanding CCJs and a few accepted you as an undischarged bankrupt? I think it was their drive to get everyone an account so benefits and pensions could be paid directly, rather than using the Post Office.

dzug1

AmitSharma wrote: »

There are additional benefits like prepaid travel cards give better exchange rates than the high street

Ciao

Whilst some of them do the majority don't - those that you get on the high street are normally exactly the same rate the same place gives for cash

NinjaPenguin

Road_Hog wrote: »

Didn't NuLabour force banks to offer basic bank accounts, even if you had CCJs or bankruptcy? I'm sure most of them accepted you with outstanding CCJs and a few accepted you as an undischarged bankrupt? I think it was their drive to get everyone an account so benefits and pensions could be paid directly, rather than using the Post Office.

They did, but they still required some kind of ID. That was my problem, no driving licence & my passport was out of date. The irony was, when I got laid off, I got a letter from the jobcentre informing me what benefits I was entitled to and that was accepted as ID to get me a basic bank account.

Now I'm all sorted with a normal bank account, but a few years ago, things weren't so good.

giblet10

Road_Hog wrote: »

Didn't NuLabour force banks to offer basic bank accounts, even if you had CCJs or bankruptcy? I'm sure most of them accepted you with outstanding CCJs and a few accepted you as an undischarged bankrupt? I think it was their drive to get everyone an account so benefits and pensions could be paid directly, rather than using the Post Office.

I think that was the theory yes. But the banks just ignored the principle. When I entered my IVA I couldn't get an account anywhere initially until I found a leaflet from the then Banking Code Standards Board that advertised Nationwide as helping those with BR/IVA. Nationwide also said no, until I waved the BCSB note in front of them - after three letters to HQ they relented, but not without a fight...

What really surprises me is two things..

1) The banks say they won't give accounts to insolvents because they don't want to get involved with messy insolvency matters i.e. who money belongs to in trustee etc.. but then Nationwide have publicly gone on record stating that's utter bollox..messy insolvencies these days are more the exception..

2) The banks don't seem to grasp that insolvency is a temporary thing for the vast majority..six years in most cases as we all know. Take me for example, I have a reasonably good income now, but didn't have when I did IVA. Now my credit files are clear I've managed to get credit again - but am I going to approach those banks who said flat no to my basic bank needs during the IVA? No, not on your life. They've burned their bridges as far as that's concerned...so they can kiss goodbye to my savings, salary funded account and any other money that they might need right now..

mikesten

Road_Hog wrote: »

Didn't NuLabour force banks to offer basic bank accounts

Maybe so, but in practice the banks didn't always obey, or if they did it was with "sub-standard" products such as a cashpoint card only or a Solo card.

I got my Cashplus card when I was in this situation to get a more widely accepted 'brand' - Mastercard.

Some people find these cards useful, some don't - the same as most financial products I guess

AmitSharma

dzug1 wrote: »

Whilst some of them do the majority don't - those that you get on the high street are normally exactly the same rate the same place gives for cash

True - only making a generalisation about the industry as a whole but obviously there will be some exceptions but there are cards out there in the travel market which will save you as much as (or as little as depending on your persepctive) £50-£100 on a £1000 conversion in conversion rates and usage fees abroad.

So to repeat the generalisation, prepaid does have its benefits for some and especially travel and money transfers are two fields where the use of prepaid can extend to the mass population and not just the subprime, the risk averse or the unbanked.

Cheers