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11/12/2009 -
While much of the attention given to prepaid card payment processing focuses on the unbanked and underbanked community, a recent report from research and advisory firm Aite Group found that this segment actually makes up a small proportion of prepaid card users.The report found that 30 percent of customers surveyed in check-cashing stores - indicating that the respondents are underbanked or unbanked, that is, without the ability to have a bank account or access credit - use prepaid cards, while 43 percent do not, 17 percent are unaware of the opportunity, 5 percent intend to purchase them, and 4 percent are lapsed owners.
"Prepaid debit cards are in the initial stages of their product life cycle," said Gwenn Bezard, research director with Aite Group and author of the report. "As such, there is ample opportunity to grow product usage. Given the distinctiveness of the target consumer segments for this product, marketing programs should be specifically tailored to the needs of each segment."
Still, prepaid card payment processing remains an important aspect of many businesses' merchant services as prepaid card used continues to grow - Mercator Advisory Group recently upwardly revised its forecast for the prepaid industry's growth to US$525.8 billion by 2012.
