Do Prepaid credit cards improve my credit rating?

I have a poor credit rating – Can a prepaid card help to improve my credit score, and does my account history update information held with Experian or Equifax?

Whilst prepaid credit cards can be a very useful product for those with a good credit rating, many card providers target their prepaid products at those with bad or no credit history. With the number of IVA’s (Individual Voluntary Arrangement) and bankruptcy cases on the increase, there is a growing population in the UK that are unable to get a traditional credit or debit card, without paying extremely high fees.

However, given you are loading your own money onto your prepaid card, and the card issuer is not lending you money, information relating to your prepaid account is generally not exchanged with the credit bureaus (Equifax and Experian). So, whilst you may maintain a healthy balance and operate your account within the card providers terms and conditions, this good history will not improve your credit rating.