The Ultimate Guide to Credit Cards
Thursday, September 29, 2022

How to Use a Prepaid Card Online in 2022

How To Use A Prepaid Card Online

credit card advice

Erica Sandberg

Written by: Erica Sandberg

Erica Sandberg

Erica Sandberg is a consumer finance expert and journalist whose articles and insights are featured in publications such as the Wall Street Journal, Reuters, MarketWatch, Forbes, and MSN Money. An experienced media host, she's led many financial programs, including her podcast, "Adventures With Money." She's appeared on Fox, CNN, "EconTalk" and "The Dr. Drew Podcast," and has been the resident money and credit authority for KRON-4 News in San Francisco for more than 10 years. Her book "Expecting Money: The Essential Financial Plan for New and Growing Families" was first released in 2008, and the 2017 edition is out now.

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Edited by: Lillian Guevara-Castro

Lillian Guevara-Castro

Lillian brings more than 30 years of editing and journalism experience. She has written and edited for major news organizations, including The Atlanta Journal-Constitution and the New York Times, and she previously served as an adjunct instructor at the University of Florida. Today, she edits all CardRates content for clarity, accuracy, and reader engagement.

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Advertiser Disclosure

Prepaid cards are among the safest and most convenient payment tools on the market. These products are issued by some of the country’s top banks and companies and many other smaller issuers. Not only can you buy things at brick-and-mortar stores with prepaid cards, but you can also use the account numbers to complete online transactions. 

This is an important feature because an increasing number of purchases are made electronically. Ecommerce revenue in the US exceeded $460 billion in 2021, according to Statista.com.

Understanding how to use prepaid cards for online shopping is essential to keeping your costs low and protecting the funds on your card. Here’s what you need to know. 

Choose the Correct Prepaid Card

Although prepaid cards resemble credit cards, there is no borrowing or repaying involved. You simply purchase the card from a store or obtain one online for free, load the account with cash (either at the register or online), and then use it as you would a debit card that is attached to a bank account. The available balance declines with each transaction you make. 

You can choose from a large number of great prepaid cards. Most are reloadable, which means you can add more money to the account at any time. Reloadable prepaid cards are ideal if you always want to have a card at your disposal but don’t have a credit card or a checking account. 

Here are our top-rated reloadable prepaid cards to use for online purchases:

Brinks Prepaid Mastercard Review

at Republic Bank & Trust Company’ssecure website

PREPAID RATING

★★★★★
4.8

OVERALL RATING

  • Brink’s gives you the peace of mind you deserve. Securing cash and valuables since 1859.
  • With Brink’s Direct Deposit, you can get paid faster* than a paper check.
  • No late fees or interest charges because this is not a credit card.
  • Use the Brink’s Money Prepaid Mobile App to manage your account on the go and get text message or email alerts (Message & data rates may apply.)
  • *Card issued by Republic Bank & Trust Company, Member FDIC. Card may be used everywhere Mastercard Debit cards are accepted. “Apply Now” for full details.
  • See additional Brink’s Prepaid Mastercard® Details.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
N/A
Variable Monthly Fees
Not applicable
PayPal Prepaid Mastercard® Review

at The Bancorp Bank’ssecure website

PREPAID RATING

★★★★★
4.8

OVERALL RATING

  • Move money from your PayPal account to fund your prepaid card account.
  • Earn cash back and personalized offers, just for using your card.
  • With Direct Deposit, you can get paid faster than a paper check.
  • Card issued by The Bancorp Bank, Member FDIC. Card may be used everywhere Debit Mastercard is accepted.
  • Click PayPal Prepaid Mastercard® for additional features & program details, and to request a Card.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
N/A
Variable Monthly Fee
Not applicable
NetSpend® Visa® Prepaid Card Review

at NetSpend’ssecure website

PREPAID RATING

★★★★★
4.8

OVERALL RATING

  • With Netspend Direct Deposit, you can get paid faster than a paper check.
  • No late fees or interest charges because this is not a credit card.
  • No Overdraft Fees on purchases using your card.
  • Use the NetSpend Mobile App to manage your account on the go and get text message or email alerts (Message & data rates may apply).
  • Card issued by MetaBank®, Member FDIC. Card may be used everywhere Visa Debit cards are accepted. Click “Get My Card” for full details.
  • See additional NetSpend® Prepaid Visa® details.
Intro (Purchases)
Intro (Transfers)
Regular APR
Annual Fee
Credit Needed
N/A
N/A
N/A
Variable Monthly Fee
Not applicable

+ See More Prepaid Cards

But a few prepaid cards — namely the gift card variety — are not reloadable and are most useful if you only need the card for a limited time, a certain purpose, or to use at a specific place. 

Aside from being reloadable, the card may be open- or closed-loop:

  • Open-loop: The most flexible prepaid cards are open-loop, which means they are connected to a universal payment network, such as Visa, Mastercard, or American Express. You’ll know if it’s an open-loop card if the payment network’s logo is on it. With an open-loop card, you have the freedom to spend anywhere that network is accepted, which is pretty much everywhere, from brick-and-mortar locations to ecommerce websites. Some even come with rewards, like the Serve® American Express® Prepaid Debit Account that offers unlimited 1% Cash Back when you spend money in stores or online.
  • Closed-loop: Gift cards fall into the prepaid card category and are typically closed-loop. They are not attached to a payment network but are instead connected to a retailer, such as Macy’s or Starbucks. With a closed-loop card, you can only make transactions at that store or on its website. These cards may be attractive if you’re sure that is the place where you want to shop. 

Review the Fees 

Depending on the prepaid card you get, there could be many fees associated with the account that are not charged by traditional credit and debit cards. The terms will be listed on the packaging and website, so take the time to read what they are. 

Typical prepaid card fees include: 

  • Activation (to start the card) – $4.95
  • Monthly maintenance  – $10
  • Transaction/purchase – .50 to $1.00 to $2.00
  • Cash reloads – $1.50 to $4.95
  • Teller-assisted cash withdrawal – 1.95 to $25.00
  • ATM cash withdrawal  – $1.00 to $3.00
  • ATM balance inquiry – $.33 to $2.50
  • ATM insufficient funds decline – $1.00 to $20.00
  • Additional card – $2.00 to $10.00
  • Paper statement – $.99 to $5.95
  • Monthly inactivity – $1.95 to $8.00
  • Card replacement – $2.00 to $10.00
  • Expedited shipping for a new card – $30
  • Foreign transaction – 1% to 4.95%
  • Foreign ATM – $1.45 to $5.00

Be sure to read the card’s terms before deciding on a card and then making a purchase. Each card has a different fee structure, and some are definitely less expensive than others. 

The Brinks Prepaid Mastercard has no monthly maintenance fees, while the NetSpend® Visa® Prepaid Card offers free reload options.

Load With Enough Cash For Your Online Shopping Needs

You’ll need to add money to your card account so you have sufficient funds to make your online purchases. But you don’t want reloading fees to erode your available balance.  

Track your purchases to know how much is left on the balance before you attempt to make another purchase so you can avoid the card being declined. This will not only inconvenience you as you are trying to buy what you want, but the decline fee can lower your card’s balance even further. 

Make Sure the Ecommerce Site is Secure

You can use your prepaid card on almost all ecommerce websites, particularly if your card is open-loop. 

But before you make the transaction, take a moment to make sure that the site is secure. Never shop directly from an email or text link. Instead, go straight to the official website associated with the company. 

Major department stores, Amazon, Shopify, and other well-known retailers with a strong online presence take measures to secure their sites with the most current protections. Smaller, independent ecommerce websites, however, may not have the same level of security. 

In all cases, look for the lock symbol in the browser’s URL field. The address should start with “HTTPS”  (meaning the transaction will be encrypted) and not “HTTP.

CardRates Secure Padlock
Look for the padlock to the left of the URL. You can click on it for more details about the website’s security.

This can help ensure you don’t fault victim to phishing scams, where fraudsters may try to steal your card or personal information.

Register and Fund Your Card to Make Online Purchases

Registering your prepaid card with the issuer is important, particularly if you plan on having it for a while. 

Your card will come with its own instructions, but the general process to activate it online is fairly consistent: log in to the company’s website, enter the card’s account number, expiration date, and your personal information. After clicking the “submit” button, the card will be registered, and you will be associated with it. 

Alternatively, you may activate your card over the phone by providing the same information. 

Sign the back of the card, and you’re ready to go online and start shopping! Have your card on hand to make the purchase. As with a credit or debit card, you will enter the account number, expiration date, and the CVV code on the back of the card if it has one. 

You have a couple of options if you want to make an online purchase but there isn’t enough money on the card: 

  • Split the transaction. If you have a gift card, you can usually apply the balance to the online payment form and then use another card for the remaining balance.  
  • Add money to the card. You may not be able to split the transaction with a prepaid card, but you can load it up with the amount you need. If you reload in a store, the money is available almost immediately, but it can take a few hours when done electronically, so you will experience a slight delay. 

The easiest way to shop online with a prepaid card is to have it listed as one of your payment options with the retailer. This way, all you have to do is select that account at checkout instead of having to input the numbers each time you want to buy something.  

What to Do If Things Go Wrong

As with any tool, problems can occur. Here are the most common issues associated with prepaid cards and online shopping — and what you can do about it: 

  • Expired card: Depending on your prepaid card, you may have to pay a fee so you do not lose the funds before the card expires. Contact the company and either request a replacement card so you can access the funds or close the account and ask for the balance to be mailed. Federal law requires that gift cards remain valid for at least five years, either from the date you bought them or from when you last added funds. In the event the card has an earlier expiration date, you can have the funds transferred to a replacement card for free. 
  • Lost card: Imagine you’re just about to make a purchase and fish around for your card, but it’s not there! Go to the issuer’s website, log in to your account, and file a report. Not only will you be protected against unauthorized charges after reporting the card as lost or stolen, but most issuers will automatically issue you a new card with the funds transferred to the new card (Check the replacement card fee so you know the real balance when you get it). It can take a few days for the replacement card to arrive, so you’ll have to save the item for later in your online cart.
  • Unauthorized transactions: If someone has already gone shopping with your lost or stolen prepaid card, log in to your account. As long as you registered the card, federal law protects you against unauthorized transactions, so you should be reimbursed. But do it quickly because if you wait too long to report it, you may not be reimbursed. 
  • The card was declined: If you punched in all the numbers correctly and have enough of a balance to make the purchase but are still declined, the merchant probably flagged the card. You may have mistakenly registered the card with the wrong information, and it is not matching up. Rectify it on the website or by calling the customer service number.

Keep in mind that these problems can happen with any type of card, including a credit or debit card, not just prepaid cards.

Prepaid Cards Prevent Debt, Let You Shop Online, and Are Easy to Get

Using prepaid cards for online shopping can make sense for many reasons. They help prevent the kind of debt you can get into with a credit card because you’re spending your own money. 

After all, browsing compelling ecommerce sites where there is so much to buy and all you need to do is hit the purchase button can be overly tempting when a credit line is available. Nor do you have to concern yourself with a monthly payment or interest. 

You don’t need to have good credit or even have a bank account to qualify. So whether the prepaid card is an additional tool in your wallet or your solitary payment method, you can use the card advantageously when shopping from your mobile device or computer with the right strategy. 

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