Creditnet Weekly Tip
Prepaid Debit Cards Don't Report to Major Credit Bureaus
Many prepaid debit cards advertise that they report payment history to credit reporting agencies. While this isn't exactly untrue, don't be fooled by the marketing speak!
Here's the catch. They may actually report your payment history to an agency, but they won't report it to any of the 3 major credit reporting agencies that matter— Experian, Equifax, and TransUnion.
What the prepaid debit card issuer may do is report your information to the PRBC (Payment Reporting Builds Credit), which is a rather new agency that collects data regarding rent payments, phone bills, utility bills, etc. The PRBC not only generates its own version of a credit report with this information, but it also generates a credit score.
The problem is lenders generally don't use PRBC's credit reports or scores to make lending decisions yet, so a good PRBC credit score is of little value to most consumers.
