What is the point of those pre-paid VISA cards?

[simonsez]

I became a married man last weekend and on Sunday my wife and I went through our pecuniary gifts.  I noticed we received several VISA pre-paid cards.  As I was glancing at them I saw that they had activation fees with them.  The $25 card had a $3.95 fee, the $50 one a $4.95 fee, and the $100 one a $5.95 fee.  Now, from my perspective, I don't have to pay the activation fees so I don't care but I am curious why the person giving the gift just doesn't write a check or give cash.  What am I missing?  It does say that if you lose the card, you can retrieve the money by having all the relevant information but that doesn't really apply to money that would otherwise be dumped into a savings account.  I guess it could be helpful to pay for things like plane tickets since you can't use cash but if the money being referenced was already in my bank account, it wouldn't matter. 

I don't know, I just don't understand the utility of them.  Great business idea by VISA I guess, get a healthy % of risk-free money since it's already been fully funded.

[velocistar237]

I'm with you. They're just a way for credit card companies to make money. I suppose it makes online transactions possible for people without credit cards or bank accounts. I think people think that it's better than a gift card because you can spend it anywhere.

[RoseRelish]

Congrats on getting married! I'm with you on these things. Brilliant for Visa/Mastercard...not so great as a gift. I'd rather have a gift card.

[Daley]

Something I've discovered with the cards is that putting money on them makes it infinitely more difficult to directly convert the credit into cash. These things are specifically designed to make you buy stuff instead of save or invest the money, and that's the mentality of the people going in and buying these gift cards for others; they don't want to give you money, they want you to get stuff. Nuts to you, gift givers... my wife and I wind up using them to buy groceries instead.

[kisserofsinners]

I use them to by porn or other things i don't trust (insists on a subscription) online.

...Of course that is no longer in the budget. Given the question, that has been the only useful thing i've seen them used for.

[simonsez]

A bit of thread drift but I can't help myself.  Porn isn't required to be in the budget.  There are so many free websites that allow streaming and even downloading.  I've never paid a direct cent.  I guess in an indirect way, I paid for it in college when I lived in the frat house with 40+ other guys and there was a house account paid for with dues but that was pennies every month then.   

Alas, I guess if one feels the requirement for an adult or sketchy online subscription and don't want to risk access to a bank account or a heavily utilized credit card, then this is a way to do it (albeit it does bring up some other issues, :) ).

[Jamesqf]

I think it's because of the attitude that giving cash as a present is... I don't know, thoughtless, as in "Hey, that inconsiderate person didn't even take the time to pick out a gift?  Even though most times the gift is not something the recipient wants or has any use for, which is why the proliferation of wedding gift registries &c.  So the pre-paid card, being a physical object that doesn't say "legal tender" on it can be considered a gift rather than cash.

[Angelfishtitan]

I think it's because of the attitude that giving cash as a present is... I don't know, thoughtless, as in "Hey, that inconsiderate person didn't even take the time to pick out a gift?  Even though most times the gift is not something the recipient wants or has any use for, which is why the proliferation of wedding gift registries &c.  So the pre-paid card, being a physical object that doesn't say "legal tender" on it can be considered a gift rather than cash.

I agree with this, even though it is silly to think a gift card takes any more thought than cash (Hence most of my birthday gifts are time intensive home cooked meals). Wedding gift registries are the worst, as my wife and I had to go through for our marriage since we got barraged by people to get on it. Why family and friends seem the least likely to listen to you when you try to sway their opinion on something that should be entirely up to you is beyond my comprehension. If they only knew we just returned most of the stuff for gift cards to buy groceries!

[madage]

The $500 ones are awesome when purchased from Kroger (or another super market - not Target or Walmart) with an American Express Blue Cash Preferred card ($75 annual fee) to earn $24.05 after activation fee. I use the balances to pay utilities, internet, insurance and all sorts of other bills that accept credit cards. I also earn 500 fuel points (no bonus points for these cards) with each purchase, which is good for $0.50 off per gallon of fuel when I need to fill up.

I agree they're incredibly silly if they cost you instead of earning for you.

[kisserofsinners]

A bit of thread drift but I can't help myself.  Porn isn't required to be in the budget.  There are so many free websites that allow streaming and even downloading.  I've never paid a direct cent.  I guess in an indirect way, I paid for it in college when I lived in the frat house with 40+ other guys and there was a house account paid for with dues but that was pennies every month then.   

Alas, I guess if one feels the requirement for an adult or sketchy online subscription and don't want to risk access to a bank account or a heavily utilized credit card, then this is a way to do it (albeit it does bring up some other issues, :) ).

Yes a little drifty, but let me follow up...

You get what you pay for...
You're right it *is* easier for men (straight and queer) to find acceptable free porn. Women and specifically queer women, are not the free porn market. At this point, i find it easier to fuck porn stars then break off any finds for media.

[Angelfishtitan]

The $500 ones are awesome when purchased from Kroger (or another super market - not Target or Walmart) with an American Express Blue Cash Preferred card ($75 annual fee) to earn $24.05 after activation fee. I use the balances to pay utilities, internet, insurance and all sorts of other bills that accept credit cards. I also earn 500 fuel points (no bonus points for these cards) with each purchase, which is good for $0.50 off per gallon of fuel when I need to fill up.

I agree they're incredibly silly if they cost you instead of earning for you.

A note for you, be careful about that or American Express will call you up to ask why you are spending so much on groceries. Credit Card companies are looking for this sort of thing all the time, and will happily close your account.

[MacGyverIt]

I became a married man last weekend and on Sunday my wife and I went through our pecuniary gifts.  I noticed we received several VISA pre-paid cards.  As I was glancing at them I saw that they had activation fees with them.  The $25 card had a $3.95 fee, the $50 one a $4.95 fee, and the $100 one a $5.95 fee.

My guess is your gift-ors wished to give you the cash to purchase whatever your gift-ees heart's desired... and didn't read the fine print. Or perhaps they saw the activation fees and paid forward the amount they could, knowing you would still benefit from using the remaining portion at almost any VISA-friendly location to use as you need, be it "fine" China or a nice dinner out. I've purchased gift certificates for specific stores but I actually like this concept more as it provides the gift-ee more flexibility in spending for their specific needs.

It's a scam but it's also a way the gift-or knows you are getting exactly what you want, when you want it. As I type this, it occurs to me that traveler's checks aren't as popular as they used to be...

[madage]

A note for you, be careful about that or American Express will call you up to ask why you are spending so much on groceries. Credit Card companies are looking for this sort of thing all the time, and will happily close your account.

Thanks for the warning. I've heard this elsewhere, too. August was a big month for prepaid GCs for me (I think I bought 4) due to several large bills. Since AMEX is always a month behind crediting cash back, I can't say for certain that "grocery" spending of $2500 in a month is not considered excessive. If anyone's interested, I can post back when I get my statement in about a week.

[gooki]

They probably know you're frugal, and want to make sure you spend the money instead of hoarding it.

But they are great for Kids who otherwise wouldn't be able to buy stuff online.

[ErinG]

I hate those things. I work in a credit union and so many members want me to get the cash for them and I can't. Also, on a shopping spree, you have to know what the exact balance is on the card to be able to use it up. I love Traveller's checks. They're pretty and can be converted to cash easily and the recipient sees no fees.