Pre-paid phone cards represent telephone time you buy in advance, paying $5-15 or more. The amount of time you buy depends on the rate-per-minute you’re charged.

For many people, pre-paid phone calls offer the ultimate in convenience because the call has been paid for in advance and the card can be used from any phone.

First marketed as clever novelties, now pre-paid phone cards are sold at newsstands, post offices, travel agencies, retail stores, grocery and convenience stores. They are used by travelers, students, people who regularly call overseas and those who may not have long-distance telephone service.

Some pre-paid phone cards can be recharged, usually by billing the additional cost to your credit card. Some cards have advanced features like speed dialing for frequently called numbers and an activity report of called numbers, which may be handy for business purposes.

The Federal Trade Commission tells us that most pre-paid cards display a toll-free access telephone number and a personal identification number (PIN). Pre-paid phone card companies have computers that use your PIN to keep track of your card usage or how much time you have on your card in minutes and units.

To make a phone call, you dial the access number, enter your PIN, and at the voice prompt, enter the phone number of the party you’re trying to reach. A computer tells you how much time, or how many units, you have left on your card and how to use other features your card may offer.

Typically, each unit equals one domestic minute. If your pre-paid phone card can’t be recharged, that is, if you can’t buy additional minutes by phone for the card, you’ll need to buy another card once you’ve used up the time or minutes.

Several key players are involved in making sure your phone card works: Carriers are responsible for the telephone lines that carry your calls. Resellers buy telephone minutes from carriers. Issuers set rates and provide toll-free customer service and access numbers. Distributors get the cards to retailers. Retailers sell the cards.

When you buy a pre-paid phone card from a store, it’s important to remember that you’ve bought a telephone service, not a product. The store doesn’t control the quality of the service. To make sure you’re getting what you’ve paid for, you may want to buy a small denomination first to test out the service, and check with friends or relatives to find out their experience with the card.

As the pre-paid card industry mushrooms, and as more people buy and use the cards, some problems are coming to light.

The most common consumer complaints are about: access numbers or PINs that don’t work; issuers who go out of business, leaving card-holders with a useless card; customer service numbers that are busy or simply don’t work; toll-free access numbers that are constantly busy, preventing use of the card; rates that are higher than advertised; hidden connection charges, taxes and surcharges; cards that debit minutes or units, even when you don’t connect with the party you’re calling; and poor quality connections.

Occasionally, pre-paid phone cards have a hidden cost — because you’ve paid up-front, you may be out of pocket, and out of luck, if you discover a problem trying to use the card.

Consumers can avoid many of the problems, and buy considerable peace of mind, by planning ahead. Although many pre-paid cards are impulse purchases, you can preempt disappointment by checking out a few things in advance:

Ask if the retailer will stand behind the card if the telephone service is unsatisfactory.

Look for the rate for domestic and international calls on the card’s package or in the vending machine. These rates may vary depending on where you call. If you can’t find the rate, call the card’s Customer Service number.

The pre-paid phone card industry is highly competitive. Beware of very low rates, particularly for international calls. They may indicate poor customer service.

Look for disclosures about surcharges, monthly fees, per-call acess, and the like, in addition to the rate-per-minute of use. Some services charge an activation fee for recharging cards.

Check on expiration dates. Most cards expire one year after first use. If there is no expiration date, a card usually is considered “live” until all phone time is used.

Look for a toll-free customer service number. If the customer service number isn’t toll-free or displaced, it may be difficult to contact the company if you have a problem with the card. A busy signal on the customer service line may be a tip-off to a rip-off.

Be sure the card comes with instructions that you understand.

Make sure the card comes in a sealed envelope or has a sticker covering the PIN. Otherwise, anyone who copies the PIN can use the phone time you’ve already paid for.

Ask friends and relatives for references on the card you’re thinking of buying. Consider these questions: Were they charged for a call when there was no answer or when the line was busy? Was there a minimum charge for each call? For example, were charges based on a minimum of three minutes even though the call lasted 30 seconds? Was the access number inaccessible because of a constant busy signal?

If you are in business and you want to distribute pre-paid phone cards or sell them in your store, the same considerations apply. Ask the company for references of the company providing the phone time and try to determine the competitiveness of the rates being offered. Extraordinarily low rates may not result in high quality service, and may be offset by undisclosed charges. Consumers are more likely to return to your store expecting a refund if the cards they bought don’t work.

Consumer Forum is a collaborative effort of the Bangor Daily News and Northeast COMBAT. Send your questions to Consumer Forum, Bangor Daily News, P.O. Box 1329, Bangor 04402-1329. COMBAT is a membership organization with basic dues of $10 a year. For membership information write to the above address. Please enclose a large, stamped, self-addressed envelope.