| For overall financial health, one of the most important | | | | with guaranteed approval. Since a pre-paid card |
| aspects is having a good credit score. Without a good | | | | comes with no risk of loss, the issuer will definitely |
| score, a consumer will have a difficult time obtaining | | | | approve the application. This is beneficial compared to |
| financing for a mortgage, installment loan, or credit card. | | | | other products that come with the risk of being denied |
| Even if a loan or credit card is obtained, a person with | | | | credit, which will add another negative mark to the |
| a bad rating will pay far more in interest than a person | | | | applicant's credit report. |
| with good creditworthiness. While rebuilding is quite | | | | The second way that a pre-pay card can help a |
| difficult, there are several credit cards available to | | | | borrower improve their score is by helping the |
| people with bad credit, which could actually help them | | | | borrower build a strong repayment history. With each |
| rebuild credit. While there are various credit cards to | | | | successful monthly payment, the borrower will improve |
| choose from, the best overall option to help someone | | | | their credit repayment history. After successfully |
| rebuild credit is a pre-paid one. | | | | making payments for a couple of years, a borrower |
| A pre-paid card is a one that has a line of credit that is | | | | will begin to see drastic improvements to their credit |
| funded by the borrower, as opposed to a card issuer. | | | | score. |
| As opposed to having a line of credit with maximum | | | | The third way that a pre-paid account can help a |
| balance that is pre-determined by a traditional card | | | | borrower improve their creditworthiness is that they |
| issuer, a pre-paid card will have a line of credit that is | | | | are low cost. Other options available to people with |
| set by borrower. Upon being issued the card, the | | | | poor credit standings come with high fees and interest |
| borrower will deposit money into the account, which | | | | rates. For someone that has trouble controlling debt, |
| will act as the available line of credit. The borrower will | | | | this could quickly lead to an escalating level of debt |
| then be able to borrow up to that amount at any time. | | | | that will further ruin ratings history. Since pre-paid cards |
| The first way that a secured card can help a | | | | are low risk to the issuer, fees and interest rates are |
| borrower improve their credit score is that it comes | | | | much smaller. |