Gift cards are a popular way for a gift giver to ensure the intended receiver gets the desired gift. One no longer has to guess what the gift recipient likes; instead, recipients can purchase what they want using the cash value on the card. Prepaid credit cards work in the same manner but with a few differences. One of the biggest differences is permanence.

The Differences Between Gift Cards and Prepaid Credit Cards

Gift cards can be purchased in several different formats. Many stores offer gift cards, but these cards can only be used at the store whose name is on the card. Gift cards that can be used anywhere can also be purchased. Once the balance on the card had been exhausted, the card can no longer be used.

A prepaid credit card, on the other hand, can be used repeatedly, so long as the cardholder keeps adding money to the card. The vast majority of these cards carry the Visa or MasterCard logo. The cards can be used to make purchases online, pay various bills or buy groceries. When the balance gets low, a cardholder only has to add money to the card.

Just like regular credit cards, prepaid credit cards have an expiration date printed on the front. The only difference between a prepaid credit card and a regular credit card is that a prepaid credit card's credit limit is the balance on the card. Gift cards also have expiration dates, but they're often much shorter.