However, there's no doubts about the undeniable convenience of paying on plastic, making it easier not just to pay for large purchases but also removing the risk of carrying lots of cash.

But with the launch of PAYG credit cards there is now another option.

We take a look at how to get a free pay as you go credit card and the advantages of applying for one.

How do pay as you go credit cards work?

Top up PAYG debit card, prepaid credit cards pay as you go, prepaid debit cards pay as you go, pay as you go top up credit card...there's lots of different names for this new type of hybrid card that's hit the market.

Whatever you want to call your card, they all work in more or less the same way. They offer the convenience of paying by plastic without the lure of spending money you don't have.

Top up credit cards have no overdraft facility and provide no means of borrowing money. Therefore, in order to start spending, you have to 'top up' with cash before you are ready to hit the shops. A good way to describe how they work is exactly like a pay as you go contract with a mobile phone. If you don't put credit on the phone, you can't make calls and likewise with your top up credit card. In order to spend, you need to load up in advance.

You will need to keep track of how much you have spent - or check your balance with your provider - as you will not be permitted to spend a single penny more than you have credited your card with. There really is no chance of getting into debt!

Almost everyone can get a prepaid card

For prepaid cards pay as you go offers even more benefits than simply the opportunity to use a Visa or Mastercard without borrowing money.

Because there is no credit facility, there are only very minimal checks carried out, usually for identification purposes only. No credit checks are required as you won't be borrowing money and can't apply for facilities such as overdrafts.

This means that even if your credit record is less than perfect and you wouldn't normally be approved for a Visa or Mastercard, you could end up with one in your wallet.

It's also possible to find pay as you go credit cards with credit builder services bolted on. Most pay as you go cards don't improve your credit score as you aren't borrowing any cash. However, some providers offer the chance to boost your credit rating by 'lending' you money.

This may seem like a contradiction but you never actually get the chance to spend this extra amount. The system works by your provider 'lending' you a year's worth of fees in advance which you then pay back - usually interest-free - by making one small repayment every month. Your top up card provider can then report to the credit agency that you repaid your 'borrowing' on time, thus enhancing your score. This is an excellent, no-risk and - most importantly of all - free way of pumping up your credit rating.

Pick your prepaid card wisely

There are a plethora of providers now on the market so finding the best pay as you go credit card will depend on what you intend to use it for.

One of the most frequent uses is to take it abroad as some cards offer very competitive exchange rates and much lower fees compared to conventional credit and debit cards. Others offer cash-back rewards, online discounts or the ability to add additional cardholders from the age of 13 onwards (providing the main applicant is over 18).

Therefore the best top up credit card can't be defined by one single provider as how you use it will determine the deal that is right for you.

If you carry out a pay as you go credit card comparison you will be able to see not just the different providers, but also the benefits each offers so you can pick one that meets your circumstances. There are different charges levied by each provider but roughly speaking you need to take into account the costs of loading money, ATM withdrawals, transactions overseas and the monthly charge. Some will also charge for providing additional cards whilst others offer this service for free. If you compare pay as you go credit cards you will be able to single out the features most important to you.

Applying for a pay as you go credit card is just as easy as other types of card; most providers offer an online facility and stipulate the eligibility criteria which generally requires you to be a UK resident and over 18.