The calling cards business is a multibillion dollar market that is growing exponentially because of their convenience and also the sophisticated marketing hypes geared to consumers. However, like all those other cards offered to consumers (credit cards- debit cards- prepaid gift cards-), you must understand the game before you play it. Otherwise, you will fall into the trap of the big players, meaning the calling card providers.
When you choose a very cheap prepaid phone card, it usually associate with more hidden charges. You need to pay attention to several common hidden charges, or the card can turn out to be a lot more pricey.
The Calling Card Game
Tax: Believe it or not, some prepaid phone cards charge a monthly tax or one-time tax, and it can be as high as $1.50. Try to avoid it by checking the information for your phone card carefully.
Long Talking Fee: Certain phone cards charge this fee that's rarely known to lots of customers. If the customer talked for more than 20 mins, 40 cents will be charged for every 20 minutes talking time. This equals to 2 cents more per minute.
Hang-up Fee: When the remaining balance of a phone card gets to less than the amount required for a one-minute phone call, this fee may apply to reduce the balance to zero. Then the phone card will be purged from the system soon
Pay-Phone Surcharge: Prepaid phone cards provide the most convenience when you want to make cheap phone calls anywhere, but there is usually a surcharge between $0.30 up to $0.75 associated when you use a public pay-phone. Payment for the use of a public pay-phone is required by FCC. However, from the variation of this surcharge, it's obvious that some phone card companies use it as a way to profit.
Maintenance Fee: Maintenance fee will be deducted from your phone card if there is still enough balance. It won't be charged on your credit card. Some phone cards will start to charge a maintenance fee either when the first phone call is connected or after the first phone call is finished. It could be as high as $1.50, so check it out, too. The maintenance fee can be charged every month, every two weeks, or every week. Maintenance fee is also called sweet fee by certain phone card companies.
Minutes Rounding: This is the basic unit to record the length of your phone calls. Industry standard is one minute rounding, as in the case of your residential telephone services. Prepaid phone cards can be rounded to one, two, or even three minutes. If it rounded to 3 minutes, your 30 seconds phone call will be considered as 3-mins phone call and your 4 mins phone call will be considered as 6 mins phone call. Statistically, on average, for 2 mins rounding, you will be charged for one more minutes for each phone call, and for 3 mins rounding, you will be charged for one and half more minutes for each phone call. So try to avoid using phone cards with more than one minutes rounding.
Communication Fee: Some phone cards that look pretty cheap can turn out to be not cheap at all. Certain phone cards are advertised with an attractive total minutes in the card. But that number was calculated based on a single call per card. Certain phone cards charge a communication fee up to 25% of the phone call's cost. This makes the rates to be 25% more expensive in reality. The advertised total minutes looks more attractive because this fee is usually applied after the call is finished.
Connection Fee: Also called first-minute surcharge. It's charged when a telephone call is connected. It varies between 25 cents to as high as $3. The easiest way to evaluate whether a cheaper phone card with connection fee is worthwhile or not is to estimate the average time for your phone calls. If you make 10 mins calls, a card for 5 cents/min with $0.50 connection fee is actually more expensive than a card for 9 cents/min with no connection fee. It's better to use a phone card without connection fee if you are not sure the person you are calling is there, and the phone call may trigger an answer machine. Phone cards with high connection fee are good for the case when you know your party is there and you intend to talk for a long time.
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