When it comes to making recurring payments, there are a few different ways to go about it. Usually, people use a credit card or a debit card. However, did you know that a prepaid card can also be an option for recurring payments?
There is a lot of confusion about prepaid cards and whether or not people can use them for recurring payments. But just like with credit cards and debit cards, you can use a prepaid card for some recurring payments.
It’s a lesser-known fact but something you should keep in mind as you make your financial plans. This article will tackle the topic of using prepaid cards for recurring payments to have all the information you need before making your next purchase.
Do Billers Accept Prepaid Cards for Recurring Payments?
Yes, you can use prepaid cards for recurring payments. However, it doesn’t work for all types of recurring payments. Their viability ultimately depends on whether a biller accepts plastic or ACH withdrawals.
For those unfamiliar, ACH is short for Automated Clearing House. It’s an electronic network that financial institutions use to process transactions. You can use a prepaid card for ACH payments if the prepaid card is linked to a checking account.
Not all prepaid cards work for ACH payments, so you’ll need to check with your prepaid card issuer to see if they accept this type of payment.
Billers That Accept Plastic
A prepaid card is most likely accepted as payment if a billing company accepts credit and debit cards. However, you’ll need to ensure that you have registered the card under your name.
Using a prepaid card, you will also need to supply your name, account number, and expiration date, similar to that of a credit or debit card. Using a prepaid card, you can make a one-time payment or set up automatic payments.
Billers That Accept Checks
Many prepaid cards also offer an online bill pay feature that lets users pay virtually any biller who doesn’t accept plastic. When using this feature, the prepaid card account owner will need to input the payee’s name, address, and account number.
With online bill pay, your prepaid card issuer will cut a check for you and send it to the merchant charging you. This method lets you see which prepaid cards will work best for you and your needs.
Billers That Accept ACH Withdrawals
Certain billers will require you to provide a bank account number and routing number so that they can automatically charge and withdraw money on a monthly basis. This method is known as ACH withdrawals and is the only type of recurring payment that prepaid cards can’t be used for.
While prepaid card issuers provide both an account and routing number for direct deposits, you can only use them for deposits into your account—not withdrawals. Again, it’s simply how prepaid card accounts are set up.
Sufficient Funds Requirement
Regardless of whether you’re using your prepaid card the same way as a debit or credit card, or you’re employing its online bill pay features, it’s important to ensure that you have sufficient funds in your prepaid card account to cover the cost of your recurring payments in each billing period.
While it might seem obvious, many people forget about recurring bills once we establish a payment method. Therefore, it’s easy to forget about your prepaid card balance. However, forgetting your recurring bills could potentially lead to errors and declined payments.
Unlike debit or credit, prepaid cards are more vulnerable to declined payments because prepaid cardholders can only spend what they’ve already deposited into their account.
We recommend setting up a prepaid card account balance alert to avoid any declined payments. This way, you’ll be notified via text or email when your prepaid card account reaches a certain balance. This can help you avoid declined payments and maintain control over your finances.
Why Use ReliaBills?
If you’re a business owner and want to start offering card payments or recurring billing, it’s important to use a platform that can offer both needs. ReliaBills is a great option as it offers invoicing and payment processing solutions, which are essential to any growing business.
If you want to take advantage of recurring payments, you can use ReliaBills to set up automatic payments for your customers. This way, you can get paid on time, every time, without having to chase down payments.
Plus, with our easy-to-use platform, you can create and send invoices in just a few clicks. We also offer a wide range of features, such as the ability to send automatic payment reminders, partial payments, and more.
With ReliaBills, you can also set your payment processing system to accept card payments such as debit and credit cards. However, remember that you’ll need to upgrade your basic account to ReliaBills PLUS (our premium version).
At just $24.95 per month, subscribing to ReliaBills PLUS will give you access to additional features such as card payments. However, keep in mind that ReliaBills only accepts ACH and credit card payments with processing fees, so you’ll need to find an alternative platform if you’re looking for prepaid card payments.
To learn more about how ReliaBills can help take your business to the next level, visit our website or contact us today. We’re always happy to help you set up recurring payments or other payment processing solutions that ReliaBills offers.
So, to answer the question “can you use a prepaid card for recurring payments?” The answer is yes. However, it can only be used for some types of payments, not all.
Prepaid cards can be used for recurring payments and online bill pay features. However, they cannot be used for withdrawals from your account.
It’s important to keep in mind that you need to have sufficient funds in your prepaid card account to cover the cost of your recurring payments in each billing period.
If you’re a business owner and want to offer card payments or recurring billing, ReliaBills is a great option as it offers invoicing and payment processing solutions. Get started today!