{"id":16551,"date":"2024-10-21T16:23:05","date_gmt":"2024-10-21T22:23:05","guid":{"rendered":"https:\/\/www.lexingtonlaw.com\/blog\/?p=16551"},"modified":"2025-06-04T16:44:50","modified_gmt":"2025-06-04T22:44:50","slug":"what-is-a-prepaid-card","status":"publish","type":"post","link":"https:\/\/www.lexingtonlaw.com\/blog\/credit-101\/what-is-a-prepaid-card.html","title":{"rendered":"What is a prepaid card and how does it work?"},"content":{"rendered":"\n
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The information provided on this website does not, and is not intended to, act as legal, financial or credit advice. <\/em>See Lexington Law\u2019s editorial disclosure for more information.<\/em><\/a><\/p>\n\n\n\n

Prepaid cards are similar to debit cards, but you don\u2019t need a bank account to get one. You use cash to add money to the card and then use it to pay for goods and services at many of the same stores that let you use a debit card.<\/p>\n\n\n\n

Prepaid cards are incredibly helpful for those who don’t have a bank account, like and for young people who aren\u2019t old enough to open their own accounts.<\/p>\n\n\n\n

Although prepaid cards work similar to debit cards, there are some key differences as well. Read on to learn how prepaid cards work, potential downsides of using them and how they differ from debit and credit cards. <\/p>\n\n\n\n

What is a prepaid debit card?<\/strong><\/strong><\/h2>\n\n\n\n

A prepaid debit card functions much like a debit card that banks provide, but you don\u2019t need a bank account to use one. You can use many prepaid cards to shop at physical and online stores. <\/p>\n\n\n\n

Not only are prepaid cards useful for those who don\u2019t have bank accounts, but they\u2019re often used as a way to budget. If you have issues with overspending, you can load prepaid cards with a specific amount. <\/p>\n\n\n\n

Prepaid cards are helpful if you: <\/strong><\/p>\n\n\n\n