These prepaid gift cards are not surveyed as credit or debit cards. Prepaid gift cards contain credit cards company logo, but they are not credit cards.
In a prepaid gift card, you load the money before using it. Prepaid cards do not have the option of borrowing a loan and paying the loan back. So, the function of credit isn’t available.
They also have no time limit. This means that a consumer can load money any time and there could be charged fees associated with the transactions. The money left after the purchase is done, retailers use that out of the prepaid gift cards.
It’s important after making a purchase to keep track of your transaction. Here are a few disadvantages of prepaid gift balance cards.
- Prepaid gift cards cannot be turned to cash money.
Prepaid gift balance cards cannot be compared to credit or debits cards. Credit cards can be loaded with money and that money can be withdrawn at an Atm machine. While most of the prepaid gift balance cards cannot be turned to money due to money laundering rules.
These rules, restrict and limit the balance of gift card to a certain amount which makes it hard to withdraw cash. If these rules were not applicable, then scammers could easily steal money by using prepaid gift cards.
- Aprepaid giftcard cannot be resold to another recipient.
Suppose you have a lot prepaid gift balance cards; you can sell them through an online platform and make profits. This gives you money for the many unwanted cards.
However, because these cards have owners, you cannot invest and make any profit for you will need the PINs, and other gift cards information’s which makes it not get resold.
What you should do is use these prepaid gift cards to purchase items or gift them to someone to use them.
- Gift cards are charged a lot of money, making them lack value
Most prepaid gift cards do not make profit. This is because the sale of the gift card is not much money. So, most companies that process these prepaid gift cars, charge for activations, and monthly charges so as to make profit.
Other prepaid gift cards also charge for transaction fees for every transaction. When all these fees add up, the credit card company now makes their profit, while the prepaid gift balance card loses its value in the market.
These prepaid gift cards that charge for activation fees and transaction fees, can inconvenience a recipient and discourage them from purchasing a retail gift card.
As a recipient using these prepaid cards that have these charges, you always feel frustrated and confused.
Incase you are interested in purchasing a prepaid gift balance card, then its highly recommended that you understand the terms and conditions of the gift company.
This will help you come to term with these charged fees and have an easy time purchasing your gift.