Solution to teenage card problem

[Carol Anne]

I recently posted about the problems my 16yr old had with acceptance of the visa electron card when trying to buy tickets online and various other places too and about the frustration and embarrasment it causes. I had a word at the bank but it is not their policy to upgrade to a proper card until he reaches 18. I then stumbled across an ad on this site, in the margin, for pre-paid Visa or Mastercard. Now for a small fee of �4.95 per month he (or anyone over 13) has the convenience of a 'fully grown up' gold mastercard with world wide acceptance, and absolutely no way of getting into debt as it is pre pay, meaning he can only spend the funds loaded on to it. He can load it with money, free of charge, at any post office or by bank transfer. The one he has from CashPlus ltd , even has purchase protection, which no other prepay card offers, giving the same protection for large purchases as any ordinary credit card does. Im surprised they don't advertise them more widely.

[Ethel]

I thought it was an excellent idea until I read the fees.

Extortionate charges, in my opinion.

�2 to withdraw your own cash from an ATM, �3 from a bank.

Payment processing fee �1.95.

I agree they are in it to make money, but this is a risk free enterprise, they get at least 2.5% on all transactions from the retailer plus interest on the monies in the account. PLUS �60 a year!

13.6 in the small print "We accept no responsibility or liability for goods or services purchased using this card."

13.9 ....you may lose your money if we become insolvent.

So there is no purchase protection with this card.

There must be a better way. I'll see if I can find a cheaper alternative.

[Carol Anne]

Hi Ethel, He was keeping the electron to draw hiscash, as I agree the mastercard fee is very high there. There was a 'Which' comparison of these cards and it claimed that the card offered payment protection. There was no mention of a payment processing fee of �1.95. Is this what they charge on top of each purchase made using the card or is it for making payments on to the card ie. Reload.? It seems the Which comparison and the actual terms differ somewhat considerably.

[Carol Anne]

www.which-prepaid-card.co.uk

[Ethel]

Hi Carol Anne

The terms are confusing. I have no idea what the 'payment processing fee (non refundable) of �1.95 is. Reloading is free (except some reload outlets MAY charge). All purchase transactions are free too.

I would normally trust Which. I can only assume the terms and conditions have changed since Which published that article. As ever you must rely on the t&c of the company and not a third party article.

I am reading more of there online information to try and find exactly what those charges are for.

[Ethel]

Apparently the Payment Processing Fee is a one off fee if you apply for the card on line. (2.4 of Terms and Conditions)

[Ethel]

Eeek! Make sure your son is aware of this clause too:

1) Tips and service charges
At certain outlets the authorisation amount may be increased before the transaction is approved. This is to protect both you and ourselves. At such locations, an additional percentage (usually 10%-20%) will be added to the bill total to cover service charges, tips or other similar costs. The merchant will check for the value of the bill plus the additional percentage, and may decline your card if there are not sufficient funds available.

For example: at restaurants your account balance should be 20% more than the bill total for your cashplus card to be accepted. This is to accommodate for any service charge or tip.



I really do NOT like that clause. I have never come across that before.

[Carol Anne]

Thanks for all that Ethel! Now guess what?
A quick phone call to the consumer organisation WHICH, confirmed that the: which-prepaid-card.co.uk ,website is not connected to them in any way and suggested wariness in following their advice.
It didn't seem so at the time, but it would appear that we are dealing with the sharp end of the market here. However forwarned is forearmed. I'll make sure my lad limits the amount he stores on it, and is carefull when dealing with them.

[Ethel]

Well good for you for phoning Which.

I am disgusted that the site is using Which in its title though.

As I see it, it is a useful card for limited, emergency use, so your child can access money if he needs to.

[bednobs]

well you are silly then ... the site is called which pre paid card? (is best for you) I cant believe you think anyone other than which cant use that word!