Prepaid Debit Card

My kid can finally shop online with his own prepaid card!

It’s a funny old world we live in. The UK is clearly moving towards a cashless society, cheques are somewhat non-existent and carrying cash on the streets can be very risky. I rarely have more than 10 in my wallet; any larger purchases always go on my credit card or debit card, depending on what I’m buying and who from. This is great for most people as almost everyone’s got a bank account with an accompanying payment card, right?

As far as I’m aware, if you’re under 18, you’re not going to have a credit card and most likely you won’t have a debit card either. Okay, fair play it makes sense that under 18′s don’t have credit cards (they’ve already got lots of ways of getting into trouble!), but it seems unfair that they can’t have plastic cards to buy things with. They always have to carry cash.

This issue is very close to my own heart. I have a fourteen year old son and he has been excluded from the electronic payments revolution. Mike spends a portion of his spare time exploring mankind’s finest accomplishment, the internet. Albeit he has very strict guides in this exploration, his parents. On his journey through this parallel dimension, he often finds art he wishes to purchase; music and other applications. Unfortunately our banking system has failed to provide him with the tools necessary to explore the internet fully; he does not own an electronic payment card. The inefficient workaround to this exclusion is for him to use his parents’ credit cards. Why inefficient? This solution gives Mike access to large lines of credit but he has not yet had the life experience to manage this responsibility appropriately.

I recently came across a useful tool for my son and me. I was surfing online and found a prepaid credit card. It’s like a normal credit and debit card but you have to actually add the cash onto it before you can spend, hence the term prepaid card! It was really easy to get, I bought a prepaid MasterCard (although I think you can get VISA ones also) and it took only a couple of minutes. The really useful bit here is that the company I bought it from offered an additional card for my son, with his name on it. His card is linked to my prepaid card so I can transfer cash onto his card online instantly.

I am very much an early adopter of technology, and so I recently acquired a prepaid card and accompanying card for Mike. I tend to be a natural sceptic but considering this technology is still first generation, I have been suitably impressed. Since receiving the plastic and associated online account facility, I have loaded funds onto my card and subsequently transferred small amounts to Miike’s prepaid card, which he has used several times now quite autonomously. The prepaid card works exactly how it was promised but there has been an ancillary benefit which I did not factor in. With financial liberalisation comes financial education. Mike is beginning to perceive money in a manner I would not expect of him for a few years yet. As he is now responsible for making his own spending decisions and he can view her transaction history, and he knows what his allowance is and when it will arrive, he appears to be learning about money management. he is taking ownership of the funds he has access to and subsequently how he spends these funds. Eureka.

This prepaid debit card has solved a problem I’ve had and I’m guessing there are lots of other situations where this type of product would work. I’ve looked around and there are quite a few prepaid credit card companies to choose from. I don’t think all of them offer cards for kids but some of them do.

This author is a consumer services analyst, focusing in bank cards and personal finance. He recommends downloading a free 36 page guide called the ‘Essential Guide To Your Money‘. For more information, go to the Blue Sky Prepaid MasterCard website.