Shocked by Optimum Prepaid Mastercard T&C

maths_max

After reading today's MSE weekly email I chanced upon the Optimum Prepaid Mastercard when looking at credit cards and thought this card would be a good card to use to register with Google/Amazon/Ebay etc. to limit fraud/over-spending... I was under the impression that Pre-paid cards were... Pre-paid, i.e. you load them and can only spend the balance?

After reading the T&C of this card I found the following statement:

"5.3 Your Card is a prepaid card, which means that the Available Balance will be reduced by the full amount of each
transaction and authorisation, plus any applicable taxes and charges, including additional ATM charges if any. You must not
use your Card if the Full Deductible Amount exceeds the Available Balance. If, for any reason, a transaction is processed for
an amount greater than the Available Balance on your Card, you must repay us the amount by which the Full Deductible
Amount exceeds your Available Balance immediately after receiving an invoice from us.

Should you not repay this amount immediately after receiving an invoice from us we reserve the right to take all steps necessary, including legal action, to recover any monies outstanding.

I though the whole idea of these cards was to prevent this from happening! Has anyone experienced this i.e. over-spent on a Prepaid Mastercard?

[Deleted User]

Don't overspend on the card then

No problem

jim1999

I presume it's because of the possibility of using an offline terminal.

maths_max

!!! wrote: »

Don't overspend on the card then

No problem

Totally agree but one of the main reasons moneysavers use these cards is to manage finances and they may stick to the rules... fraudsters don't! That's the point I'm making. If you have a credit card from your bank you ring them up and tell them there has been fraud on your cards and they deal with it... This puts the onus back on to the already vulnerable user of the card who has fraud committed against them and Optimum take legal action against them, thus affecting their credit score.

eskbanker

I think you're missing the point here - there is a slim possibility that such a card could slip into the red by a small amount but any [STRIKE]significant[/STRIKE] transaction will require online authorisation which will be declined if it exceeds the available balance, so fraudsters wouldn't be able to run up a massive bill in the way you appear to believe.

Any attempt at legal action where the cardholder has promptly reported alleged fraud would be doomed to failure anyway....

Edit: it looks like this is a card where all transactions are authorised online, so the scenario outlined in clause 5.3 is even less likely to materialise, given the clarification in subsequent clauses:

5.5 Your Card cannot be used in situations where it is not possible to obtain online authorisation that you have sufficient balance for the transaction. For example: transactions on trains, ships, and some inflight purchases.
5.6 Your Card cannot be used at self service petrol pumps. You can use your Card to pay by taking it to the cashier

eDicky

Why would you pay £5 for this card, plus other fees, without having the facility to withdraw your funds without charge?

http://www.myoptimumcard.co.uk/costs/

Consider instead : https://loot.io/

18cc

If you want a card that will basically not allow you to go overdrawn then rather than putting your money on a prepaid card why don't you open a monzo current account and put the money in there

you can then use your debit card to spend on eBay Amazon etc and providing you have the overdraft slider set to 0 anything that will take you into overdraft will be bounced

Nasqueron

maths_max wrote: »

Totally agree but one of the main reasons moneysavers use these cards is to manage finances and they may stick to the rules... fraudsters don't! That's the point I'm making. If you have a credit card from your bank you ring them up and tell them there has been fraud on your cards and they deal with it... This puts the onus back on to the already vulnerable user of the card who has fraud committed against them and Optimum take legal action against them, thus affecting their credit score.

You don't have a credit score, only credit history. A fictional score going up and down has no impact on what you can borrow or not

SnowTiger

maths_max wrote: »

After reading today's MSE weekly email I chanced upon the Optimum Prepaid Mastercard when looking at credit cards and thought this card would be a good card to use to register with Google/Amazon/Ebay etc. to limit fraud/over-spending... I was under the impression that Pre-paid cards were... Pre-paid, i.e. you load them and can only spend the balance?

After reading the T&C of this card I found the following statement:

"5.3 Your Card is a prepaid card, which means that the Available Balance will be reduced by the full amount of each
transaction and authorisation, plus any applicable taxes and charges, including additional ATM charges if any. You must not
use your Card if the Full Deductible Amount exceeds the Available Balance. If, for any reason, a transaction is processed for
an amount greater than the Available Balance on your Card, you must repay us the amount by which the Full Deductible
Amount exceeds your Available Balance immediately after receiving an invoice from us.

Should you not repay this amount immediately after receiving an invoice from us we reserve the right to take all steps necessary, including legal action, to recover any monies outstanding.

I though the whole idea of these cards was to prevent this from happening! Has anyone experienced this i.e. over-spent on a Prepaid Mastercard?

It's a myth that pre-paid cards offer more or better protection than standard cards.

Who would you rather deal with if there was a problem transaction on your account?: a big, well know, name or a small player who charges £1 per call to customer services - the fee being taken from the balance on your card. Presumably, if you don't have a positive balance on your card you're denied access to customer services.

As for spending beyond the balance on a pre-paid card - yes, it's possible. Using TfL is one example of how this could happen. They take a 10p test transaction at the beginning of your first journey during the day, then calculate the total cost later. My local bus company seems to use a similar system.

My local Tesco wasn't able to process card transactions recently. Rather than turn away customers, they queued transactions which were put through the system later.

System

It's just a lawyer written clause to cover all eventualities.

The card issuer would be able to raise an action for unjust enrichment even without that term.

Also, any unfair terms are essentially unenforceable (in a consumer contract) due to evil EU legislation...

iqra

do optimum mastercard service let me know of any frauduelent transaction i.e where and for which purpose it is used?