Alternative credit methods seeing spike in popularity

Fifth Third Consumer Bank recently launched a prepaid card for customers, which is reloadable and includes a $7 monthly service fee. "[The card] may be used as a budgeting tool or way to segment spending, to make secure online purchases or as an alternative to cash for those without a traditional bank account," said Executive Vice President Steven Alonso. Fifth Third Consumer Bank is one of the latest firms trying to take advantage of the growing popularity of alternative credit payment methods. For example, prepaid reloadable debit cards are becoming increasingly common, according to MSN Money, even gaining on gift cards in popularity as a holiday present. The news source outlined several benefits of these cards, particularly with regard to flexibility. While gift cards can only be used at a single store or chain, prepaid cards are typically usable anywhere credit or debit cards are accepted. In addition, alternative credit has some safeguards in case the card is lost or stolen. For example, American Express, Visa and MasterCard all have policies in place that prevent a person from being charged for fraudulent transactions. Gift cards, on the other hand, generally don't have such strong protective measures.