As the credit crunch worsens and recession sets in, the popularity of prepaid cards continues to rise with good reason. These prepay cards have many benefits which include

* Easily Available - There are no credit checks and no bank account is required to get a pre paid card which means you can get a card even if you have a poor credit history or CCJ's as long as you can confirm your identity and address.
* Stay in control and no debt risk - With a prepay card, there is no risk of debt or overspending as there is no overdraft facility on the card and hence, they are an ideal way to budget for yourself or help to manage your children's spending.
* Excellent for Travel - Many providers offer dollar and Euro pre paid cards and an exchange rate which is much better that that typically available from high street bureau de change and FX providers. There is the added convenience of loading your card online or at designated retail locations.
* Global Acceptance - Being MasterCard, Visa or Maestro branded, you can shop anywhere in the world where these scheme brands are accepted - on the Internet, over the phone and on the high street.

How to minimise fees payable on prepaid cards?

Given all the wonderful benefits of prepay cards, it seems quite surprising that prepay solutions have not been more widely adopted and that is probably due do the fees attached to them. However, there are a number of ways that you can save on these fees by simply thinking about how you intend to use your card to make your pre paid product an even more attractive proposition.

Tips to save fees on prepaid card application and usage

* Application Fees - Choose your pre paid card carefully. Card applications typically cost between GBP 4.45 and GBP 9.95 but numerous providers provide free cards if a small minimum amount is loaded up front.

* Application Mechanism - You can apply for pre paid cards online, instore or via SMS using your phone. SMS is usually chargeable although it is convenient and you could save up to GBP 2.50 on SMS application costs by using methods of making applications.

* Activation Fees - Choose a pre paid card in which the activation fee is included within the application fee. Most pre paid card providers allow card activation online or by calling them. Avoid premium telephone numbers as these can be quite expensive and it is better to activate your card for Free online where possible.

* Top-up or Loading Fees - Loading a Pre paid card with funds is usually free from most providers as they are keen for you to load your card. Check the different loading methods that your pre paid card issuer provides and choose the method that is free or is the most cost-effective.

* Point of Sale Fees - Pre paid card providers typically charge a fee for using your pre paid card at point of sale and this can vary from a few pence to up to around 2.95% of the value of your transaction. However, there are a number of providers who provide free usage at POS and hence, if you think you will be using your card mostly at POS, get a card with zero POS fees.

* ATM Fees - The majority of card fees are likely to come from making ATM withdrawals and these tend to be pretty steep. You should avoid withdrawing money at ATM's with your pre paid card where possible but if ATM is where you intend to use the card and aim to make numerous withdrawals, choose a card which has low withdrawal fees. There are a few providers who allow a couple of free ATM withdrawals and then charge a small fee for subsequent withdrawals.

* Pay Monthly or Pay as you go Tariffs - Some cards providers give you the option of choosing a Pay monthly or a Pay As You Go tariff. You can save on Point Of Sale (POS) fees, ATM withdrawals and loads based on the tariff that you have chosen. Choose a card fee structure that is right for you.

* Card currency - For travel cards where usage abroad is the main criteria, choose a card currency which is local to your travel destination. Euro and Dollar are the two most popular options available for UK travellers going abroad which means that you pay no currency conversion fee if use your Euro card in a Euro currency region and a USD card where USD is the acceptable transaction currency. You are already getting a better deal as the FX rate on the card is better than what you would get from high street foreign currency providers.

Compare Prepaid Cards at Prepaid365

Divya Sharma is the author and senior editor at Prepaid365 - the UK's prepaid card comparison portal and an expert in the prepaid card industry.