KARS Unlimited Telephone Card
What is A Pre-Paid Phonecard?
A pre-paid phonecard (telecard) is a
debit card, not a credit card. You pay, in advance, and it
retains the memory for telephone time to be used later. As
you use the telecard, the time is deducted until it is used
up at which time the card expires. Some cards are disposable
and some are re-chargable.
Why Would I Want To Use A Pre-Paid Telecard?
The basic concept is to enable people to
make phone calls when away from home, without the need to
carry coins. This is another step towards a 'cashless'
society and a Global monetary system. As the World shrinks
through instant communication, methods of communication must
Additionally, pre-paid (debit) technology
is less expensive to provide than traditional (credit)
technology, therefore a less expensive product for the user.
Surcharges are eliminated when the cost of the company's
credit department is eliminated. There is no longer need for
extension of credit, expense of collections, or losses
incurred with non-payment. Losses are minimized when a
'card' is stolen, since a telecard has a limited liability
as opposed to a telephone credit card.
Are There Different Types of Telecards?
Yes. There are Stored Memory and Remote
Memory Telecards. Each type includes instructions for use.
Stored Memory Telecards store the
phonetime memory within the card. The three commonly used
techniques are 1) computer chip, 2) magnetic strip, 3)
optical scan strip. They require a special telephone (e.g.,
yellow NYNEX phone in New York City) that can read the
information stored on the card.
Remote Memory Telecards utilize a
different technology. The phonetime memory is stored
(remotely) in the Company's computer. The user calls a toll
free (800) number to gain access to the computer, dials in a
personal identification number (PIN) to identify the
individual card and then dials the number to be called. A
special phone is not required.
Why Are There Different Types of Telecards?
The telecard industry is evolving to meet
demands for many different venues.
Local phone companies (e.g., NYNEX,
BellSouth, Ameritech, US West) maintain public phone booths.
it is convenient to use a public phone without carrying
change. A stored memory phonecard is easy to carry in a
wallet or purse and easy to use, just insert and dial.
Additionally, there is no longer an incentive to vandalize a
public phone. Aside from the loss of revenue, phone
companies must repair or replace a vandalized
Long Distance Carriers (e.g., AT&T,
MCI, Sprint, LDDS, etc.) have an International marketplace.
It would be impractical to seek a stored memory phonecard
that could be accepted by telephones throughout the World.
Developed in the United States, remote memory phonecards
provide a practical alternative. Access via a toll free
phone number can be assured from virtually any touch tone
phone in the World.
When Would I Use A Telecard?
When you are away from home and want to
make a telephone call, what do you do? Most people use a pay
phone with coins or use a Calling Card, which is a telephone
Coin operated phones are expensive to
operate and maintain. Telecard use helps provide the service
at a lower cost to the user with increased
The charge for a call by Calling Card is
billed to your home phone or to a separate account with a
company like AT&T, MCI, Sprint, LDDS, etc. You are
paying for the actual time (which may be extra for operator
assisted calls like person-to-person) plus a surcharge
(approx. 80¢ per call) to support the company's billing
department. A telecard is a debit card. Telecard use helps
provide the service at a lower cost to the user with
Additionally, there are other reasons to
- While staying at a
Hotel: Hotels often charge an additional fee
for use of their in-room telephones. They often
automatically charge day-time, operator-assisted
rates, even if you dial directly and don't use an
operator. They often add a surcharge, up to 50% in
some cases, in addition to the cost of the call.
However, most hotels allow free access to toll-free
numbers so you can use your telecard at your
- While at a friend's
house: Make a phone call, your friend will not
incur any cost.
- While at work: Long
distance access is often limited at the workplace.
Toll free access is usually available, so use your
- College students: Do you
want to encourage your child to call home
frequently, but don't want to pay for their other
long distance calls? Telecards can be programmed to
only call the numbers you want. Call home and I'll
pay for it, but you're on your own for anything
- International travelers:
Call home without the concern of exchange rates or
obtaining foreign currency.
- At home: Many companies
offer free phonecards as an advertising tool or
promotional incentive. Many people give telecards
as gifts. Use these cards since free time costs
less than your home direct dial
Will A Telecard Really Save Me Money?
Telecards save money on phone calls, when
used properly. The savings can be significant, up to 60% for
a three minute, daytime call from New York to Los Angeles,
compared to a Calling Card. The per-minute charges may
appear similar for Pre-paid Telephone card, Calling Card and
Coin pay calls, but there are no surcharges with telephone
cards (a surcharge is a fee added onto the first minute of a
phone call that helps offset the cost of operator assisted
and Calling Card credit expenses). However, per-minute rates
vary widely, competition is fierce. And, remember,
phonecards are not meant to compete with direct dial from
home. Commercials can be confusing when trying to compare
What Is A Collector's Phonecard?
One of the most fascinating aspects of
telephone cards is their collectibility. Like coins, stamps
and sports cards, many people throughout the World collect
phonecards. Germany and Japan lead the World in telecard
collecting but, the US market is catching up
Phonecards are collected for their
beauty, rarity, theme depicted (e.g., Disney characters,
Puzzle Set, Corporate logo like Coca-Cola, Event
commemorated, Show attended), Company or Country producing
the card (e.g., AT&T, Telecom New Zealand, Ameritech,
Landis & Gyr). Collections are organized according to
individual taste: by Company, by Theme, by Edition Size,
Naturally, phonecards are being produced,
specifically, to appeal to collectors. Many companies offer
special designs, special denominations, limited editions of
small mintage, beautiful presentation folders, etc. The
collector must be thoughtful and careful when choosing among
the thousands of cards available:
- Always purchase a phonecard
that you like. There is never a guarantee it will
increase in value. However, it is true that many
cards have increased significantly in value on the
collector market. A good guide is a solid company
with a solid product.
- There are many sets offered to
collectors in limited editions. Generally, a
smaller edition follows the normal rules of supply
and demand. A card, or set of cards, may be
available in regular edition for a low price, but
available in a special folder, counter stamped for
collectors, packaged with stamps, or packaged with
a CD at a premium. Good sets have been highly
sought after by collectors and many have
- Check the per-minute rate. Time
tends to be more expensive (50¢ to $1 per
minute) on collector cards. For example, it may be
necessary to pay royalties to a celebrity whose
picture appears on the card or to support an
Interactive platform where more than phone calls
are available. Something to be aware of when
comparing rates among 'user' cards.
- Collector cards tend to come
packaged, sealed, in envelopes, with scratch-off
PINs, etc. These may be cards to keep intact and
not use the time. Be aware that it is debatable
whether keeping a card in its envelope or opening
it, using or not using the time on it enhances or
destroys the "collector value" of the card. Most
agree, however, that a card with scratch-off PIN is
worth more with scratch-off intact (i.e., never
- Carefully evaluate the producer
of the phonecard. Some companies are here today,
gone tomorrow. Several rarities (and hence
expensive cards) have been created by companies
going out of business, but many more have simply
become worthless. Be aware that when a company goes
out of business, the phonetime backing the card
What About All Those Companies?
There are many Companies producing
phonecards. When choosing a phonecard to use, evaluate the
Company behind it. Choose one with a good track record, a
reliable supplier of phonetime, a credible product. When a
deal sounds too good to be true, it usually is. A phonecard
with time significantly below the industry average (e.g.,
18¢/min) may mean financial difficulties and an
inability to pay the bills (If the Company goes out of
business, the phonetime backing the card is lost) or a lack
of support services (e.g., 24 hr customer service) in an
effort to cut corners. Beware of regular phonecards that are
not labeled with their cost and/or time provided (you should
not have to open a sealed card to know what you are paying
for). Collector packs may be different, however, due to the
nature of the special presentation folder.
What If I Need Help Using My Telecard?
Telecards should contain complete
instructions on their use. Telecard Companies should provide
24 hour/day customer service to help with phone call
problems. Check on these prior to purchase.
What Happens When My Phonetime Runs Out?
Many cards are disposable when the time
runs out (but the wise person keeps the card for its
collector value). However, many offer a way to purchase
additional time, usually by charging the additional time to
your credit card. Advantages include:
- No need to purchase a new card,
which may require an activation fee.
- Many companies offer lower
rates upon renewal. It is less expensive for the
Company to re-charge a card rather than manufacture
and sell a new card.
- You won't be cut off during an
important call. Instead, your call will be held and
you will be offered the opportunity to add
- Eliminates the concern of
having a little time left, but not enough for the
call you want to make. The time remaining won't be
wasted, it will be added to.
Most companies now offer automatic
renewal. You will never run out of time and your
conversation will never be interrupted to offer additional
time since additional time will automatically be added and
charged to your credit card at a predetermined
Can I Give A Phonecard As A Gift?
Absolutely. Phonecards make perfect
gifts, especially for the hard-to-buy-for friend or
relative. It can be difficult to find a useful gift, but
most people make phone calls. Whatever rate your friend or
relative pays for their long distance service is irrelevant,
since free time is still free. Telecards can be used from
virtually any touch tone phone.
Do Telecards Have Other Uses?
Phonecards are one of the most versatile
Customize the front of the card with your own design.
Suggestions include your business logo, business card,
business artwork, or photo of your product line. Every
time you give a card to someone, you are giving a
'mini-billboard' that advertises your company. Each
time they use the card, they will think of you and
your product. And don't forget the people that are
looking over their shoulders!
Promotion: Give a phonecard
(customized if you like) as an incentive to valued
employees, as a thank-you, to publicize an upcoming
event or campaign, to commemorate an event, as an
invitation to an event (with a built-in way to RSVP).
The possibilities are only limited by your
Fund Raiser: Phonecards can
be customized with the logo or insignia of your
favorite charity and then sold to raise funds for the
organization. An attractive, new alternative to the
traditional fund raisers. Not only will the
organization realize a profit upon the initial
sale/donation, it is possible to choose a company that
will continue to donate a portion of the time renewal
fees to the organization (residual income).
The newest product in the pipeline is the
stored value 'Cash Card' being developed by VISA. This is a
device that, like a telecard, is pre-paid, but, unlike a
telecard, will be accepted by selected merchants that accept
the VISA credit and debit cards for product purchases.
Eventually, you will be able to add cash to your card via
your Bank ATM machine. Watch for details in your area and
our new Guide to Stored Value Cards coming out in early
This material was prepared by and
represents the opinions of KARS Unlimited.
Order Line: (800)
Talk Line: (352) 365-0229
Fax Line: (352) 365-6323
P.O. Box 895340
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