The constant steam of credit card offers you get through the mail and by phone tends to make you unaware of the other possible alternatives to credit cards.

Here are five alternatives to credit cards.

Debit Cards – these cards have been used in many European countries for a number of years, but are relatively new elsewhere. By definition, they are just like credit cards and are accepted in most places where credit cards are accepted.

If you are wondering what the differences are between the debit and credit cards, it is that the debit cards take money directly out of your bank account while credit cards bill you at the end of the month. You must be made aware of the fact that you may not be as well protected against fraud with a debit card as you would with a credit card. Another way to describe a debit card would be to call it an electronic check.

Prepaid credit cards – these cards work just like regular credit cards do, but you are not allowed to carry a negative balance. You have to deposit money into your pre-paid credit card account before you can spend with it, this means that you ‘top-up’ this card the same way you do with pre-paid cell phones. This could be a great method of controlling spending and you might even consider giving one to your child to control their spending. Just the money that has been put on the pre-paid credit card can be spent if it is stolen, so this makes it safer than a debit card.

When used in conjunction with a credit card, bank overdrafts can be a far better way to borrow money than using a credit card. Your overdraft limit is set by your bank according to how much you deposit into your account each month and you don’t need to pay it off until you want to. It gives you the ability to have your account go into the red or negative numbers. A relatively high rate of interest is charged by many banks for an overdraft, although they are rarely as high as that charged by credit card companies and when the bank considers you to be one of their better customers, you may be given an even better overdraft interest rate.

Another alternative to credit cards are the traditional loans. Helping with the financing of your dreams of home improvements and new cars will come easier and cheaper when you contact a bank or another type of lender. These types of lenders will be able to lend the money to you at a much better interest rate than a credit card company would, since they know why you are needing the loan and they can set you up with regular monthly payments to repay it.

The last alternative to credit cards to be listed here is credit unions. Credit unions are very much like banks, only more local; they are formed as a co-operative and owned by their members and run by the community, thus they are a good place to borrow money. Credit unions are a good place to borrow because there are laws that set limits on how much interest they can charge, since they don’t need to make a profit for the owners and shareholders, due to the fact that they do not have any. If there is a credit union in your area, it can be a solid alternative for borrowing and worth looking into.

Visit JSNet.org for more information on credit cards including great deals on instant approval credit cards