The key differences between prepaid cards, debit cards, and credit cards are as follows: Prepaid Cards:

• Prepaid cards are loaded with money in advance, either by you or someone else, and you can only spend the amount loaded on the card. Once the balance is used up, you must reload it to continue spending.
• They are not linked to a bank account.
• Prepaid cards do not build credit because they are not a form of credit.
• They often come with various fees such as account opening fees, reloading fees, monthly maintenance fees, and ATM fees.
• They are accepted widely, similar to debit and credit cards, but may have some restrictions (e.g., not always accepted for deposits or fuel).
• Prepaid cards are useful for budgeting or for people without access to bank accounts or credit cards.
• They provide some consumer protections but generally less fraud protection compared to credit cards

Debit Cards:

• Debit cards are linked directly to your checking or savings bank account.
• When you use a debit card, money is immediately withdrawn from your bank account.
• Debit cards do not build credit.
• They usually have fewer fees compared to prepaid cards, though some banks may charge account-related fees.
• Debit cards offer worldwide acceptance and are commonly used for everyday transactions.
• Some debit cards offer overdraft protection, but this can come with high interest rates.
• They provide more fraud protection than prepaid cards but generally less than credit cards

Credit Cards:

• Credit cards allow you to borrow money from the issuing bank up to a set limit to make purchases or withdraw cash.
• You pay back the borrowed amount later, often with interest if not paid within a grace period.
• Credit cards help build or rebuild your credit score if used responsibly.
• They offer the highest level of fraud protection among the three card types.
• Credit cards provide an interest-free loan period if bills are paid on time, enabling "buy now, pay later."
• They are widely accepted globally and often come with rewards or benefits

Summary Table

Feature| Prepaid Card| Debit Card| Credit Card
---|---|---|---
Linked to bank account| No| Yes| No (credit line from bank)
Spending source| Preloaded funds on card| Funds in linked bank account| Borrowed credit from issuer
Builds credit| No| No| Yes
Fees| Often higher (reload, monthly)| Usually lower| Varies, can include interest
Fraud protection| Limited| Moderate| High
Overdraft allowed| No| Sometimes (with fees/interest)| N/A
Usage| Spend up to loaded amount| Spend up to account balance| Spend up to credit limit

In essence, prepaid cards are prepaid and not connected to a bank account, debit cards draw directly from your bank account, and credit cards allow borrowing with repayment later. Prepaid and debit cards do not build credit, while credit cards do. Prepaid cards often have more fees and less protection compared to debit and credit cards