Prepaid debit cards are currently a staple in the financial sector, especially since more than 2 billion people are without bank accounts. The most common uses for the cards are bill payments, check cashing, shopping online, and gift-giving. A large number of prepaid card purchasers are consumers that don’t have bank accounts. In one large survey of consumers without accounts, only 4% of the participants said they didn’t need a checking account. Which means the remaining 96% need an account, but are not able to open one for some reason.
One reason people gave for not having a bank account was that they didn’t have enough money. Following close behind were the consumers whose bank accounts were closed because of overdrafts. Deficiencies like these create a need for prepaid debit cards. If used correctly, they can be a good financial fix. Misuse leads to frustration and a massive headache.