How Do You Solve The Problem of Purchasing Online Without A Credit Card?

In a consumer environment increasingly wired to the Internet, credit cards prove effective tools for carrying out online purchases due their security and ease of use. However, a growing number of consumers no longer use credit cards to make online purchases. Some are shedding credit cards in an attempt to create better spending habits, while others have been denied or have restricted lines of credit due to the current economic climate. So how do these credit-less consumers purchase items safely online? Of the alternatives, neither debit cards nor prepaid cards are optimal as online debit card transactions are far less secure (especially now with increased hacking of online security systems) and prepaid cards can come with fees attached.

There are several alternatives for online payments, each of which has its drawbacks. The threat of data breaches may give some debit-using consumers pause, since cyber thieves could access the victims’ cash accounts. The fees associated with open-loop prepaid cards may steer consumers to other payment methods. Additionally, the capability of online merchant acceptance systems for prepaid cards may limit the consumer to the merchant’s own gift card.

Below is a compiled list provided by TimeMoneyland of major retailers and how easy it is to purchase items on their sites without a credit card.

ITunes: If you want to download music, movies or other media on iTunes without a credit card, the easiest way is to buy an iTunes gift card at a brick and mortar retailer. Unlike general-purpose prepaid cards, you’re not charged anything above the face value of the card.
Amazon: The bookseller-turned-web-behemoth is pretty accommodating to customers without credit cards. Buyers can make purchases through their checking accounts for almost anything on the site, including things sold by third-party sellers, with a few exceptions. Amazon also offers its Amazon Payments system, which essentially lets you use Amazon’s digital “cash register” to pay for items on a handful of other websites, giving web shoppers another option for online purchases without a credit card or debit card.
Groupon: Unfortunately for lovers of cut-rate hot air balloon rides and teeth-whitening services, a company rep for Groupon says you’ll need either a credit or debit card to snag Groupon’s daily deals.
PayPal: A slew of smaller retailers — not to mention giants like eBay — give customers the option of paying via PayPal, which in turn gives customers the option of making payments using their checking account information.

The author of this article makes an interesting point: in an ever growing online marketplace, consumers who lack either the ability to hold onto a credit card or have purposely shed it may be sacrificing ease and safety when shopping for goods electronically.

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Tags: Prepaid