Prepaid cards ‘can aid debt management’

Prepaid cards can help people to handle their debt management, it has been suggested.

Peter Harrison, a card and payments expert at moneysupermarket.com, said that the products can assist consumers in taking control of their finances.

“One of the key things about prepaid is that you only load what you want to spend, which I think is quite crucial,” he commented.

The cards can aid people in sticking to a budget, he noted, adding that another advantage is that they are not linked to other banking services, such as a current account.

Meanwhile, new laws being introduced concerning credit cards may cause users to face up to their debts, it has been argued.

Money Advice Trust spokesperson Becky Boden-Wilks remarked that the legislation – which will ban card providers from raising credit limits unless the customer requests it – will affect those who rely on borrowing.

“People will have to confront the problem earlier,” she said.

By Jamie Price