The application of pre-paid cash card for consumers.

Basically, there are 3 types of cards, namely the pre-paid cash cards, credit cards and debit cards, which all of them provide almost the same functionality. The main difference between them is the method of paying.

For the pre-paid cash cards, you have to top up its balances before you use them, and it does not allow you to spend more than the amount you have pre-deposited into the account. Unlike credit cards, it allows consumers to spend money in the sense of credit terms, which means you are actually borrowing the money from the bank and paying it back later with the interest charges as well. On the other hand, debit cards deduct the amount spent from the consumers’ deposit account which is similar with the pre-paid cash cards, but the difference is that many debit cards offer an overdraft, which is credit, and you will be charged a small fee on that.

In short, pre-paid cash cards are cards that allow users to make a payment without the carrying of tangible cash, provided there’s an amount of balance in the pre-deposited account.

Following are examples of Pre-paid Cash Cards in Malaysia:

Touch 'n GO

AmBank NexG PrePaid MasterCard

The Application of Pre-paid Cash Cards

• Use for Daily Life

Consumers can use the pre-paid cash cards anywhere as long as the pre-paid cash card is accepted for use. For instance, the consumers can use the pre-paid cash cards for their daily life activities such as purchasing groceries at a supermarket, having dinner at the restaurant, paying for the transportation, toll, or parking fees, and so on.

• Online Transactions

We tend to get busy with our work or study sometimes. It is therefore very convenient for consumers to use the pre-paid cash cards to purchase or book something through online websites such as Amazon.com, Lelong.com, TGV.com, Redbox.com, and etc. Furthermore, they can also use the pre-paid cash card to make a payment of their utility bill, phone bill, student bill and other bills through the internet as well.

• Substitution of Travelers’ Cash

Usually, prepaid cash cards such as “AmBank NexG PrePaid MasterCard” are accepted worldwide. Therefore, rather than carrying a large amount of cash while travelling, it is safer for consumers to just hold on to a pre-paid cash card.

• Withdrawal of Cash from ATM

Not all pre-paid cash cards allow us to withdraw money from the ATM. But, most of the pre-paid cash cards allow their customers in doing so because for certain places, the pre-paid cash cards cannot be used for payment. Therefore, it is important for the pre-paid cash cards to have this function in order to allow their customers to withdraw cash out of the ATM in times of emergency.

In a nutshell, with pre-paid cash cards, customers will have a better control towards the spending rather than the credit and debit cards. In addition, it does not have a debt risk since the user cannot over spend the amount which the cards have. It is also much more secure carrying a pre-paid cash card rather than a huge amount of money. With the reasons mentioned above, that is why these pre-paid cash cards have became so popular today.