With all the “plastic” payment options out there, I often see questions about what the differences are between them. When referring to credit cards, debit cards, prepaid cards, and ATM cards, just to name a few, it’s only natural to wonder exactly what one option offers that another doesn’t.
Well, the good news is that, other than the pure ATM only card, there isn’t really much difference in availability for each option. Let’s just do a quick recap on what the basic differences between the options are.
We’ve all grown to love (and hate) them. The most basic explanation of what a credit card is can pretty much be taken directly from the name; it’s a card that makes payments drawn from credit. The company who issues your card provides you with a line of credit, normally a monthly limit, and you can make purchases totaling up to that limit. Balances are then paid off on a monthly basis, with interest rates charging you for any balances left unpaid. With the huge increase in online and mobile payments in the past few years, credit cards offer a major convenience when it comes to shopping and making payments, allowing you to make electronic purchases with virtually every modern day merchant.
The way in which you use a debit card (backed by an issuer such as Mastercard®, Visa®, etc…) is virtually the same as a credit card, but payments are instead drawn from available balances in a bank account linked to the card. It’s definitely the financially responsible way to go if you have trouble watching your spending (I know I do ;)) as you don’t risk falling into negative credit. You either have the funds available in your bank account or you don’t.
The ATM only card is pretty simple; it’s a card allowing you to make cash withdrawals from any ATM supported by your bank, linked directly to the available balance in your bank account.
At Payoneer, we do our best to offer a variety of payment to our global network. The Payoneer Prepaid Mastercard® card is essentially a combination between a credit card and a debit card. The card can be used online, in-store and at ATMs worldwide just like a credit card; however, the card must be preloaded with funds before it can be used, which means that much like a debit card, you must have funds available to utilize the card. Whether via partner/affiliate payments, private loads, card to card transfers, or any other load method, once funds have been added to the card it can be used to make purchases both online and offline, at any location worldwide accepting debit Mastercard® cards.
As the card is prepaid, it is not linked to any line of credit or bank account, and therefore any purchase attempts exceeding the available card balance will simply be declined (which is an excellent way to budget your funds and stuck to that budget). Additionally, the card is not linked to your personal banking details and is therefore is far more secure (and reduces the risks of fraud).
Tips for using the Payoneer Prepaid Mastercard
- There are ZERO fees associated with using your card at retail locations (POS) If you are looking to reduce your payment fees, this is the way to go!
- Currently, Payoneer offers cards in USD, EUR and GBP (availability depends on location). Conversions are done automatically to your local currency.
- Specific merchants who offer services prior to payment, such as a gas station, ATM or restaurant, have the ability to “force post” a charge. This means that the card is charged before checking if funds are available. In this scenario, you card can in fact go “into the negative” if it exceeds the available card balance. Payoneer does not charge any fee when this occurs, nor do we penalize your account in any way. The funds are simply worked in to the overall balance once you receive additional payments.
- When using the Payoneer Prepaid Mastercard at an automated gas dispenser (paying “at the pump”), any station that issues a “pre-authorization” charge of less than $75.00 will be unable to charge your card. To avoid this situation, simply pay the cashier directly. (The pre-authorization amount is normally listed or displayed on the pump).
- Mastercard® restricts the maximum balance that can be available on the prepaid card to $10,000.00. Your Payoneer account, however, has no balance limit, and any available funds exceeding $10,000.00 will simply be held in your Payoneer account balance and automatically transferred to the prepaid card as you spend (both balances can be viewed at any time by logging in to Payoneer desktop or via the Payoneer mobile application.