What do Russell Simmons, Kim Kardashian, Mickey Mouse and Elvis have in common? They are all shills for Prepaid Credit Cards, and in my opinion are all greedy, manipulative pigs (except Elvis – he’s dead).
See, prepaid cards are good at allowing the banking account-challenged among us to use plastic. They are also really good at charging super high deposit, withdrawal, and transaction fees. So good, that in most cases these fees are considerably higher than if they were to use a checking account at a local bank.
What the Prepay card providers are NOT good at is reporting information to the credit bureaus. As of now, there are no prepaid credit cards that report to ANY of the bureaus. This means that there is no positive credit upside to using them and most likely, those that use them will be stuck doing so. (Great way to help the community, huh Russell?)
A great alternative to prepay cards are Secured credit cards. Many have reasonable fees, reasonable interest rates….and yes, most report to all three credit bureaus! Just make sure they are paid on-time, of course.
For a list of secured credit cards with some great rates, I suggest you go here: http://www.creditrepair.to/secured
