Prepaid card is a specific payment method where funds are directly linked to a particular card irrespective of the bank account, and are well-suited with both open loop and closed loop networks. Generally, these types of cards are available for everyone, without requiring the rating, credit score or bank account and can be easily utilized in paying online bills, at stores, as well as in purchasing goods & commodities. These cards are substitutes to bank-linked cards and are largely used by the population not having bank accounts or for those who can’t afford its maintenance charges.
Some of the key benefits of the prepaid card include better customer experience, hassle-free payment methods, and easy access to such cards.
As per analysis, “Global Prepaid card Market” the key companies operating in the global prepaid card market include PayPal Holdings, Inc., Green Dot Corporation, H&R Block Inc., American Express Company, JPMorgan Chase & Co., BBVA Compass Bancshares, Inc., Mango Financial, Inc., Kaiku Finance LLC., UniRush, LLC, NetSpend Holdings, Inc and among others. Renowned players operating in the industry are undertaking different strategic initiatives for instance partnerships & collaborations which are gaining considerable popularity in the prepaid card market. Players are also collaborating with other market players to provide prepaid cards with the flexible credit limits to attract a large consumer base for prepaid card.
By type, prepaid card market can be bifurcated as open loop and closed loop. The closed loop segment dominates the global market owing to growth in adoption of multi-purpose prepaid card by retailers, travelers and students. In addition, by industry vertical, market can be bifurcated as corporate institutions, government, retail & ecommerce, financial institutions and others.
Rise in demand for cash alternatives, followed by growth in developments in the e-commerce industry, increase in influence towards plastic money, availability of affordable & energy-efficient prepaid cards, increase in trend to go-cashless and growth in adoption of Artificial-Intelligence (AI) & Internet-of-Things (IoT) technologies are some major factors, which are responsible for growth of the prepaid card market. Apart from this, increase in risk due to technological advancement and lack of standardization & fraudulent attacks are major hindering factors for market. Moreover, increase in unbanked & under-banked population is a leading opportunity for market.
By geography, the North-America is a leading region in global prepaid card market owing to favorable government regulations for prepayment cards and growth in adoption of prepaid cards by different employees across the region. The Asia-Pacific and Europe regions are estimated to witness higher growth rate due to increase in public assistance in the developing Asia-Pacific countries coupled with growth in retail applications, governments and corporate institutions over the forecast period. Additionally, the Middle-East and Africa region is also estimated to witness higher growth rate caused by increase in number of online stores and rise in awareness of the utilization of prepaid cards over the forecast period. It is projected that future of the global prepaid card market will be bright because of growth in e-commerce sector and rise in demand for cash alternatives during the forecast period.
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Ankur Gupta, Head Marketing & Communications