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What Most Consumers Do Not Understand About Prepaid Debit Cards

With the holidays near, shopping can become a stressful time for many consumers. They are faced with in increase of shoppers causing less inventory, crowded stores and longer lines. Maintaining a seamless checkout process can seem like a daunting task, but can occur, especially being prepared for potential problems.

Prepaid debit cards are a popular gift for people due to the fact that they can be used virtually anywhere. When shoppers really don’t know anything about what Aunt Bertha does in her freetime or need a gift for their son’s bus driver, someone they have only spoken to about the weather, a prepaid debit card can be a quick idea. The trick with these cards – most people do not understand how they work.

Few and far between these days are anything financially – be it debit cards, checking accounts or loans – not being associated with fees. These cards are no exception. Not only do they have fees, but shoppers can be charged every time they use the card and sometimes when they don’t use it, such as cards that charge users for a month without purchases. The trick is knowing which card you have. Each one has different fees and different stipulations on spending. (On a side note, the gift giver should also expect a fee, just for buying the card.)

So, why do shoppers need to know about these fees? It is the cardholder’s responsibility to know exactly how much money remains on their card. Say Aunt Bertha was gifted a $100 prepaid gift card and spends $63.97 on clothes. A few weeks later she has come to your store and purchased $40 in products, with tax, and wants to purchase it on her card and pay the small remainder in cash. Unfortunately, you can not simply swipe her card, like a gift card, and then have the remaining balance. The store owner or clerk must first put in how much of her transaction she is paying with her prepaid debit card (as if you were splitting her transaction with two types of payments) to come up with the remaining balance to be paid with cash.

So, how much does Aunt Bertha have on her card? All she can remember was that she paid 60-something. Aunt Bertha also doesn’t know that she pays $4.95 each month in fees. When you try to run her card for anything other than what remains on her card, it will simply say she has insufficient funds.

Explaining these details and processes to a shopper can be very time-consuming and frustrating, especially to someone who has never used such a card. These days, prepaid debit cards can hold thousands of dollars in cash and often these types of problems won’t result from these customers, but be prepared. The last thing anyone wants in a long line of people waiting to do business with them is a difficult customer at the front.

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