
Prepaid Cards
Alternatives to credit or debit cards
Prepaid cards let you load cash on to them before spending on them in shops or online. Or they can be used like a bank account if you can't get or don't want one. In this guide, we run through how to use prepaid cards, and the best buys.
What are prepaid cards?
Prepaid cards do exactly what they say on the tin. You load cash on to a card, which can then be used in shops and restaurants. But remember the crucial point:
If you haven't loaded money on it, you can't spend on it.
Think of them like pay-as-you-go mobile phones. You can't spend beyond £0, forming a 'safe' barrier if you tend to overspend.
Another bonus is that you won't get credit-checked when you apply, making the application process much simpler. They're a good option for those who have just moved to the UK, or have a bad credit history.
Best prepaid cards
The following cards are our current top picks, based on low fees or other perks. See if there's one that is right for you.
For NHS staff. Get up to 5% cashback on everyday spending – free in year one
If you work in the NHS, the Health Service Discounts Cashback Card is free in the first year (£2.99/yr after) and gives cashback on spending in store and online at a wide range of retailers, including Asda, Boots, M&S, Sainsbury's and Waitrose (see FAQs for full list).
If you already shop at these stores, using this card is an easy way to get 2.5% to 5% cashback, since you can top up small amounts before you shop – the minimum top-up amount is £5 to start and then £10 for further top-ups.
You can track the cashback you accrue in your online account or using the card's app. Once processed (normally within seven days), cashback is added to your account when you next top up and is then available to spend.
Application fee: None
Annual fee: £2.99 (free in first year)
Top-up fee: None
ATM fee: N/A – can't withdraw cash from card
Transaction fee: None
Card issuer: Visa
Overseas fees: 2.5% on spending (can't withdraw cash from card)
Fee to get your cash off the card: £5
Inactivity fee: £5/mth (see FAQs)
The Monese Simple prepaid card will cost you nothing if you keep within certain limits. It's free to spend on both in the UK and abroad, though there's a 2% fee (min £2) if you spend more than £2,000 overseas in any given month. It also allows free worldwide ATM withdrawals up to £200 (a 2% fee applies above this, min £2). If you want higher limits, Monese offers Classic and Premium cards, but both have a hefty monthly fee.
While the card uses the near-perfect Mastercard exchange rate on overseas transactions, if you're looking for a prepaid card to use abroad, see our Prepaid Travel Cards guide to compare this against other cards.
Application fee: £4.95 for card delivery
Monthly fee: None (Simple card)
Top-up fee: Up to £200/mth free (2% fee above this, min £2)
ATM: Up to £200/mth free (2% fee above this, min £2)
Transaction fee: None
Card issuer: Mastercard
Overseas fees: Spending: 0% (2% above £2,000/mth); ATM: 0% (2% above £200/mth, min £2)
Fee to get your cash off the card: Free
Transferwise's* Borderless account is designed for overseas use, as it allows you to spend and withdraw cash at the perfect 'interbank' exchange rate – though it does charge fees.
The card costs £5 upfront, but it's free to use in the UK after that as long as you don't spend in a foreign currency and don't withdraw more than £200 in cash in any 30-day period (a 2% fee applies on any withdrawals over the free limit).
Note: If you are looking for a prepaid card to use abroad, see our Prepaid Travel Cards guide for a list of cards to compare.
Application fee: £5 for card
Monthly fee: None
Top-up fee: None
ATM (UK): Up to £200/mth free (2% fee above this)
Transaction fee (UK): None
Card issuer: Mastercard
Overseas fees: Spending: 0.35%-1% exchange fee (depends on currency); ATM: Up to £200/mth free (2% fee above this)
Fee to get your cash off the card: Free
Best for teenagers
If you're looking for a card to give to teens so they can learn how to manage their money, then it's worth checking out our Top Cards For Under-18s guide. It covers the best prepaid cards and children's bank accounts that allow parents a certain level of control over the cash, while still giving teens an easy way of spending both in stores and online.
Prepaid cards and bank accounts for kids offer different features, so depending on what your child (and you!) want, one could be better than the other.
Cashback sites may pay you for signing up
As an extra boon, members of specialist cashback websites can be paid when they sign up to some financial products. Do check that it's exactly the same deal though, as terms can be different. Remember, cashback is never 100% guaranteed until it's in your account.
Full help to take advantage of this and pros & cons are in our Top Cashback Sites guide.
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