Prepaid cards ‘can help debt management’
Prepaid cards will become more popular as people seek new ways to tackle debt, it has been claimed.
Newcastle Building Society Card Solutions has predicted that there will be a ten per cent increase in the use of prepaid cards by people with Individual Voluntary Arrangements (IVAs) by 2012.
The organisation, which provides Mastercard, has issued 2.3 million cards to the UK and Europe. It estimates that there will be “exceptional growth” in the market over the next four years.
Spokesperson Kriya Patel commented: “Without credit options and ties to bank accounts, these cards offer real solutions to a vast number of Britons and are in a very strong position to aid debt management across the country.”
They can be appealing to those with a poor financial history as they must be topped up before use and do not offer credit.
Recently, online payment company Paypal encouraged people to use a prepaid card to help keep holiday spending under control.