By Luigi Wewege

Whether you spend time traveling abroad for business or pleasure, choosing to carry an offshore prepaid Visa or MasterCard is a smart move. It always ensures you’ve got cash on hand and provides a convenient way to track spending.

Here are some basics that will help you select the right international prepaid card and always feel ready for any event.

How Does the Card Work?

With an international prepaid card, it’s possible to set a limit that works for you. Many international cards can be funded from business or personal checking accounts. The account used for the funding may be international or domestic.

All that it takes to fund the card is to transfer to the account connected with the card. In some cases, the transfer will be completed in minutes, and you can make use of the balance immediately. With other card plans, it may be the next business day before the transferred funds appear in the card balance.

In terms of using the card for transactions, they work just like any type of credit card. Present the card at the time of purchase. You may need to enter the security code found on the back of the card at certain venues. If you’re shopping online, enter the card information just as you would with a domestic credit card. Assuming there are enough funds in the prepaid account, the transaction will go through with ease.

Where Can I Use the Card?

You can use the card at any location that accepts Visa or MasterCard. Look for the labels found on the front doors of shops as well as at the registers. That will let you know if the merchant does accept the type of card you’re carrying. Keep in mind that you can use the card in domestic as well as international settings.

This makes it easy for you to buy all sorts of goods and services while abroad. Shop for clothing, personal hygiene products, pay for food in restaurants, or buy medications. The fact that the card is prepaid won’t matter to merchants.

Can I Transfer Funds or Get Cash?

While you will need to check the terms and conditions that apply to the prepaid card, many issuers allow users to withdraw cash in local currencies. You would use a local ATM for this purpose. There are likely to be daily limits on the amount of money you can withdraw.

Transferring funds may also be possible. If the need arises, you could transfer money from the card to a checking account. Once it posts to the account, it would be possible to use the increased balance to make purchases using the debit card tied to the checking account. Keep in mind that the transfer could take a few hours or possibly not post until the following business day.

Are There Fees Associated with the Account?

The typical prepaid credit card does include fees for different functions. There’s sometimes an activation fee that applies when you first receive the card. You may also find that a loading fee is imposed when you transfer money into the account backing the card. Balance inquiries or withdrawals at ATMs are also likely to result in a fee.

Before securing a prepaid card account, ask the issuer for a breakdown of all potential fees. This includes one-time fees as well as recurring ones. You can compare that fee schedule with the schedules offered by other issuers. Doing so allows you to understand better which card would work the best in your circumstances.

Are There Limits on the Amount of Money I Can Load Into the Account?

While there are some exceptions, most prepaid card accounts do come with balance limits. Most of them are sufficient enough for most travel plans. When you receive the schedule of fees, ask what the funding limit happens to be for the account.

What sort of limit can you expect? It’s not unusual for issuers to set limits that are around USD $10,000. Since it is possible to transfer more money into the account as you use the current balance, it’s relatively easy to track how much is left and add more as the need arises.

Can I Add Backup Funding to the Card?

Some international prepaid cards allow you to do more than initiate a transfer that adds money to your credit card balance. The same account used for transfers can also serve as backup funding. That will help reduce the risk of incurring fees for failed transactions.

In this scenario, you make a purchase, but there’s not quite enough money in your prepaid account to cover the expense. The card issuer uses the total balance and then initiates a withdrawal from your backup funding source. That amount equals the funds needed to complete the transaction plus any fees that apply. Until you transfer more money into the credit card account, it cannot be used for any additional purchases.

Do Offshore Prepaid Cards Come with Rewards Programs?

Not all offshore prepaid cards come with rewards programs, but some offer plans that work much like those you use at home. While a rewards plan is not reason enough to choose a specific prepaid card, it can be a nice bonus if you like all the other card features and functions.

Someone who uses the card frequently could end up with a reasonable monthly bonus or build up enough points to purchase something that he or she has wanted for some time without using cash.

What Happens if I Don’t Use the Card for a Period of Time?

Don’t be surprised if your prepaid credit card comes with what’s known as an inactivity fee. This is a fee that the issuer will assess if there are no transactions on the card for a specified period of time. That period may be 30, 60, or 90 days. You’ll find the schedule for inactivity listed in the terms and conditions that apply to the card.

There is a workaround for avoiding inactivity fees that often applies. Many cards are set up to recognize credits as well as debits as qualified activities. If you don’t plan on using the card for a couple of months, make it a point to initiate a small funds transfer to the card at least monthly. That will count as activity and prevent the fee from occurring.

Will the Card Expire At Some Point?

Like domestic credit and debits cards, your prepaid card will come with an expiration date. Until that date arrives, feel free to use the card as much as you like. Once that date arrives, any attempts to use the card will be rejected.

The card issuer is likely to contact you a month before the expiration date arrives. That provides time for you to verify that you want a replacement card with a new date. You will also have the opportunity to confirm the mailing address. Some issuers will also offer the option of expedited delivery for a fee. In most cases, cards sent through the post without any special delivery will still show up in 10-14 days.

Mundo has a team of experts in banking that can hep you open accounts nearly anywhere in the world. They will also help you find the right jurisdiction for you. Contact us today for a consultation.

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