The revolution of computers and Internet was highly instrumental in speeding up the process of banking and transactions. Digital cash technology, that makes the use of electronics, computers, and databases for its operation, has now started replacing conventional paper money and coins.
In case of a credit card, we swipe the card and the credit card company bears the expenditure at the time. We then reimburse it when the monthly bill comes. The company charges us a fee or an interest for bearing our expenditure.
The same principle is applied in the case of debit cards. The only difference in this case is that the users of the card have to pay the amount first to the company and then spend it.
For example: If one uses a debit card that he got from the free prepaid debit cards scheme that his bank had provided. Before spending anything, he first has to pay his bank a certain sum, say USD 100 and only then he can spend the amount by swiping the card.
Due to this type of working, commercial debit cards are popularly also known as stored value cards. This kind of facility is also given by banks, where the amount that you swipe simply gets deducted from your bank account balance.
What is a Reloadable Prepaid Debit Card?
There is no significant difference between a normal debit card and a reloadable debit card. This debit card is to be periodically updated with cash, hence, the term reloadable. Some companies have also started the same service for recurring and specified expenses.
An example that is fast coming into vogue is that of the petro card, which is a reloadable card that can be used for filling gas at almost all gas stations. The same companies and organizations providing the best prepaid debit cards have started providing international tourists, frequent fliers, and businessmen with a reloadable debit card.
These can be swiped at almost all airports irrespective of the currency exchange rate. These cards are also known as universal prepaid debit cards. Some other such innovative ideas, such as prepaid debit gift cards, free prepaid debit cards, etc., have also been put into use.
Many banks have started facilities where one can buy prepaid debit cards online, without going to the bank itself.
There are several advantages and disadvantages of such debit cards, but the fact that this concept is revolutionizing the modes and methods of payment cannot be disputed.
The best advantage of reloadable cards is that the modes of payments are being standardized and are taking a more uniform guise. It is good example of how conventional notes and coins are being replaced with different transnational methods, like plastic money and digital cash technology.