|Sept '13||Aug '13|
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|Total Assets |
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The market for prepaid cards will nearly triple by 2014.
Don't ignore the size and potential of the prepaid market.
Consumers loaded approximately $57 billion onto prepaid cards in 2011, according to Mercator Advisory Group. The consumer payments advisory firm projects the numbers to jump to $167 billion by 2014.
"Depository institutions should not cede this place in the market to nonbank players, as many of these households might indeed become customers for traditional banking products as they improve their financial status over time," advises Synergistics CEO Genie Driskill.
The cards are particularly popular among young consumers.
People between the ages of 18 and 34 are more likely than other demographic groups to consider using a prepaid card instead of a checking account, according to researchers at Synergistics.
Of these young adults, 41% said they're either "very" or "somewhat" likely to use a prepaid card in lieu of a checking account. That percentage was steady across income ranges, according to the study.
A smarter choice
Many credit unions use prepaid services as a transitional tool to more mainstream financial products.
The Coopera Card, for example, is a reloadable Visa prepaid card built specifically for the Hispanic community that helps credit unions attract new members.
Coopera developed the card in partnership with The Members Group to help credit unions ease members of the Hispanic community into the financial mainstream.
"Reloadable prepaid cards are an extremely effective way to introduce the local Hispanic population to community-based financial institutions," says Miriam De Dios, Coopera CEO.
The Coopera Card gives Hispanic cardholders access to a secure financial management tool and eliminates the need to pay high fees to cash checks, obtain money orders, or transfer funds.
(Via Credit Union Magazine)