Having a strong credit rating is one of the most significant aspects of overall financial health. Without a good credit history, a consumer may be unable to get a mortgage loan, auto loan, small business loan, personal loan, or even a credit card. Fortunately for many people with bad credit, there is another option for getting a credit card even if they have a very bad credit score. Prepaid credit cards are an excellent way of getting a credit card with bad credit.
A prepaid credit card is a credit card which is serviced by a normal credit card servicer, but instead of having a credit limit provided by a creditor or retailer, the credit limit is funded by the prepaid card user. The user normally writes a check to the credit card servicer prior to the card being funded. Once the account is funded, the credit limit is normally between 90% and 100% of the amount funded.