Introduction
If you’re looking for the best way to pay for gas in your car, there are plenty of options. But what’s the difference between prepaid fuel cards and regular credit cards? What kind of fuel card should you choose? And which type works better for certain types of drivers? To answer these questions and more, we’ll look at four types of prepaid fuel cards: closed-loop, open-loop, fee-based, and rebate.
Closed-loop cards
Closed-loop cards are only accepted at the gas station where you purchased them. They cannot be used at other gas stations, and they do not carry any value outside of the system.
Closed loop cards are useful for companies with a fleet of vehicles that need to track fuel usage on a daily basis or for larger fleets that use GPS tracking systems to monitor activity. The closed loop card works as an internal record system, allowing employees to keep track of their mileage and expenses more easily than if they were using paper receipts or spreadsheets. Learn about the what is p card and how it is helpful.
Open-loop cards
Open-loop cards are the most popular type of prepaid fuel card. They can be used at any time and anywhere, with no restrictions on how much money you have on them.
Open-loop cards do not have a set amount of money on them; instead, they work like an account balance at your local gas station or convenience store (or wherever). When you’re ready to pay for your next fill-up, just swipe open loop and insert your credit or debit card into their payment terminal.
Fee-based cards
Fee-based cards are a type of prepaid fuel card that charge a fee for the card. The fee is usually deducted from the transaction amount, but it can be charged by the merchant as well.
The reasons why these types of cards exist include:
- The card issuer may have an incentive to sell more of its products (for example, when store credit is used on an in-store purchase).
- Merchants may want to encourage customers to use their credit cards rather than cash or checks (a percentage of purchases made with them might be returned back at checkout).
Rebate cards
Rebate cards are issued by gas stations, and they have a fixed amount that is loaded onto the card. The card can be used at any gas station that accepts it, but you’ll have to pay an additional fee for each transaction (usually between $1 and $3). You can reload your rebate card at any time—just visit your local convenience store or gas station with cash in hand and ask for an extra $10 gift card on top of what’s already on there.
There are four types of prepaid fuel cards, including closed-loop, open-loop, fee-based, and rebate.
There are four major types of prepaid fuel cards, including closed-loop, open-loop, and rebate.
Closed-loop cards are issued by a single merchant to customers who want to use their card at that merchant only. For example, a closed-loop card may be used at Walmart or CVS for purchases only at that store and other retailers cannot accept them as payment. Open loop cards can be used anywhere the cardholder chooses to shop; however, if you want to take advantage of certain promotions or benefits offered by certain merchants (such as discounts), you must pay an additional fee for this privilege or opt-out altogether. In addition to these types of prepaid fuel cards falling into one category or another depending on how they’re used–or whether they offer any benefits whatsoever–, there’s another factor worth considering: whether they charge monthly fees while you’re using them! Those who don’t mind paying upfront might choose this type over regular debit/credit cards since they don’t have hidden expenses attached as interest rates do; however, those looking over their shoulder at all times might find themselves reconsidering their decision once realizing how much money could be saved if only every transaction wasn’t so expensive.
Conclusion
We hope that this article has given you some insight into the different types of prepaid fuel cards available and what they can do for your finances. If you have any questions about the different types of cards, don’t hesitate to ask us in the comments section below!
