14
Jun

Prepaid Cards Gaining Wide Acceptance

Posted by David Pratt

prepaid industry growthWith as many as 1 in 4 American families remaining unbanked or “underbanked” there remains strong demand for alternatives to traditional checking accounts or credit cards. Prepaid cards are increasingly an option for many consumers and employers.

A recent article in the International Business Times underscored the growing acceptance of prepaid cards as a payment method for consumers of all types.

Demand for prepaid debit cards is expected to soar, with as much as $118.5 billion to be loaded into the cards in the United States by 2012, up from $8.7 billion in 2008, according to research firm Mercator Advisory Group.

“These cards can be used anywhere just like a debit card and you can reload them, so it’s becoming more common, and consumers love the convenience,” Signal Hill analyst Mayank Tandon said.

Also driving this growth is the fact that more employers like Wal Mart are eliminating paychecks and instead requiring employees to set up direct deposit to a checking account or if they don’t have a checking account, accepting their pay on a prepaid payroll card.

MasterCard and Visa continue to grow their debit networks. In all, it looks like bright days ahead for prepaid cards, and more options for prepaid cardholders.

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