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Prepaid credit cards differ from their more traditional counterparts by allowing the cardholder to draw upon a limited amount of funds that the borrowers themselves load onto the card. That is opposed to drawing against a line of credit or a bank account balance, as a traditional credit card does.

These prepaid cards may be appealing to certain types of consumers for a variety of different reasons. First, they’re convenient and they can be extremely useful for parents of college-aged kids, as it allows them to control the amount of money on the card and giving them the ability to reload it as needed. Additionally, the stricter underwriting practices of lenders, combined with the fact that many consumers boast less than-perfect credit scores, may make prepaid cards the only viable option for many folks out there.

"There are just some things that you really have to use with some kind of a credit or a debit card," says Erin Dufner, who is the senior vice president of communications for the Central Texas Better Business Bureau, to the statesman.com. Renting a car or making airline reservations are two such examples. "So, typically, when we see a slower economy and consumers are unable to get a credit card — sometimes they've maxed out their credit cards and they need a way to charge — this is a great alternative for them."

However, since the start of 2011, prepaid debit and credit card companies located in Texas and the Permian Basin have been the subject of more than 320 complaints to the BBB. "There has definitely been an increase." She went on to say that besides the complaints, the bureau has gotten more than 6,000 inquiries on these particular companies.

"In terms of fees that are charged by these companies, consumers just aren't necessarily aware," Dufner said, reported by the statesman.com. "And then the companies are responding to these complaints saying, ‘well, it's outlined in their terms and conditions when they signed up online; they accepted those terms and conditions when they actually put in their application.' "

Prepaid cards generally don’t have application and activation fees, but they can be subject to a wide array of other charges not associated with traditional debit and credit card accounts.

Users can be charged for things like adding funds to the card and any transactions such as purchases, withdrawing cash or checking card balances at an ATM.

"If you want to receive a printed statement in the mail, there may be an additional charge for that," Dufner says to the statesman.com. "There may also be things that you're charged for, such as calling in and speaking with a customer service representative that may appear as a charge on your card."

Consumers can protect themselves by contacting the BBB to investigate the issuing company's record, and also by reading through all of the terms and conditions of the card. Should you ultimately decide that a prepaid card is not for you, going online to compare credit cards can help you to select one that is altogether more appropriate.