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Many banks and financial institutions offer prepaid credit cards these days. These cards are quite similar to traditional credit cards except that the credit card limit is determined by the preloaded funds. Many credit card users prefer prepaid credit cards as it helps them get the benefits of credit cards without dealing with high-interest credit card debts. A prepaid credit card can also help new-to-credit users build their credit scores. 

Benefits of Prepaid Cards

Here are some of the benefits of a prepaid credit card: 

  • Eliminates the need to carry excess cash 

  • Can be used to make instant  ATM cash withdrawals

  • No need to worry about interest accruals and credit call bills 

  • Simple eligibility criteria 

  • Makes for a thoughtful gift for friends and family

Types of Prepaid Credit Cards

Here are the different types of prepaid credit cards: 

  • Open-Looped Cards

Also referred to as open-system cards, these types of prepaid virtual credit cards are branded with the network that they’re affiliated to, namely Visa, MasterCard, or Amex. The respective card will carry the logo of the affiliate brand and is usually accepted across all merchant stores.

  • Closed-Loop Cards

Unlike an open-looped prepaid card, the acceptance of a closed-loop credit card is restricted to the affiliated merchant outlets only. This means that you can buy goods and avail services only at that merchant’s outlets with this credit card type. Most gift cards are closed-loop cards.

  • Semi-Open Looped Cards

These are hybrid prepaid cards with features of both open- and close-loop card types. A semi-open looped card is accepted by a variety of chains or merchant outlets that are affiliated with the card’s brand or carry stores of the respective brands.

  • Reloadable cards

Reloadable prepaid cards are those prepaid cards in which the cardholder can reload funds once the original fund limit is exhausted.

  • Non-Reloadable cards

Non-reloadable gift cards are those prepaid cards wherein you cannot reload funds once the original fund limit is exhausted. Generally, gift cards fall under the non-reloadable prepaid card category.

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Some of the Top Prepaid Cards From Different Banks

Here are some of the most popular prepaid cards from leading card issuers:

Name of the Credit Card Issuer

Prepaid Credit Card

SBI Prepaid Card

State Bank Gift Card

State Bank EZ Pay Card

State Bank Foreign Travel Card

State Bank Achiever Card

Axis Bank

Axis Meal Card

Axis Bank Gift Card

Axis Bank Smart Pay Card


ICICI Expression Gift Card

ICICI Meal Card

ICICI PayDirect Card

ICICI Gift Card


Millennia Prepaid Card

GiftPlus Card

FoodPlus Prepaid Card

Apollo Medical Benefit Card

MoneyPlus Card

Kotak Bank

Kotak NETC FASTag Card

Kotak Konnect

Kotak Gift Card

Kotak Netc@rd

Prepaid Card vs Debit Card

Since prepaid cards and debit cards have a few similarities, it can be easy to confuse the two. However, it’s important to understand the difference between the two to be a savvy cardholder. Here’s a table highlighting the differences between the two: 

Prepaid Card

Debit Card

Funds have to be preloaded in the card

Funds are directly debited from the bank account

You need not have a bank account to use a prepaid card

Debit card requires a bank account associated with it

You can easily reload a prepaid credit card online or with cash or cheque and use it for making transactions

A debit card can be used for as long as you have funds in your bank account

FAQs on Prepaid Credit Cards

A prepaid card is a type of card in which funds are directly added to the card. The purchase limit of a prepaid card is restricted to the amount of funds added to it. On the other hand, a credit works on credit borrowed from the bank or the financial institute issuing the card. However, a prepaid card can be used to make transactions just like a regular credit card.

No, prepaid cards and debit cards are two different types of cards. While a debit card directly debits the money from your account, for using the prepaid card, the funds need to be pre-loaded in the card.

Prepaid cards offer benefits like ease of transaction, eliminating the need to carry cash, easy payment of monthly bills, and better expense management, among other things.

Applying for a prepaid credit card online is a good idea if you do not have a bank account or want to give gift cards to your employees or family members. The card does not affect your credit score and since the limit is restricted to the available funds loaded into the card, you need not worry about incurring heavy interest or debt on your transactions.

A prepaid card may be right for you if you are someone that wants the ease and convenience of a credit card but does not want to run the risk of overspending. 

A gift card, much like a prepaid credit card comes with preloaded funds that can be used to make purchases. The only discernible difference between the two is that you may be able to accrue reward points on purchases made with prepaid credit cards. 

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