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Increased popularity of Prepaid Cards

July 08, 2013 Author by Pamela G.

Increased popularity of Prepaid Cards

Increased popularity of Prepaid Cards

It is estimated that about 2.5 billion people around the world do not have a formal account at a financial institution. This enormous population of unbanked individuals, however, still appreciates the security and convenience of card payments. This is why service providers such as Netspend Inc. have found tremendous success providing alternative banking solutions via reloadable prepaid debit cards, paycards and related financial services.

Prepaid debit cards are accepted by most merchants and provide a great alternative to cash at point-of-sale terminals. Merchants are able to process these payments as they would other card payment types. Different providers of prepaid cards offer different services to their patrons so due diligence will certainly pay off in terms of avoiding certain maintenance and card processing fees. Some Pre-paid card providers will charge a point-of-sale fee for pin based or signature based transactions while others will not. Many big banks now offer prepaid cards as well, and with so many cards and so many fees finding the right one can be quite a task.

Following the recent announcement that TSYS has completed its acquisition of Netspend Inc., it will be interesting to see what changes transpire over time. One thing is certain though, cash transactions are coming closer and closer to extinction as more people make the choice to use electronic payments.

  

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