Friday, December 25, 2009

Happy Holidays from Prepaid Expo

We're taking some much needed time off from our coverage of Prepaid payment cards to celebrate the season with our loved ones. We want to sincerely thank you for your readership, your comments and your participation.

Here are our top posts from 2009:


We'll be back in January with more coverage.

We wish you Happy Holidays!



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Wednesday, December 16, 2009

Disaster in New Jersey? Policyholders to Get Paid Via Prepaid Debit Card


Getdebit.com reports that victims of disasters in New Jersey may now get the financial help they need more quickly, thanks to prepaid debit cards issued by The Bancorp Bank, a wholly owned subsidiary of The Bancorp, Inc. The cards will be issed by Bancorp in collaboration with InsurCard.

Here’s how the program works. The InsurCard Visa Prepaid Debit Card is loaded when emergency payments are required, eliminating the challenges associated with check issuance. The InsurCard can be used to make purchases wherever Visa debit cards are accepted and cardholders have access to cash through ATMs located nationwide. Policyholders can obtain account balance and transaction information 24-hours a day.

What do you think? Should beneficiaries receive payment via debit card?



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Tuesday, December 15, 2009

Avoid Mountainous Charges this Holiday Season with Prepaid Cards

This post in Fair Investment highlights how choosing the right type of prepaid card for the Holidays can help consumers avoid a mountain of charges. Instead of using credit cards, consumers should use prepaid cards to make it easier to budget holiday spending. Prepaid cards can be used worldwide just like any credit card.

Peter Harrison, moneysupermarket's travel money expert recently mentioned:

"Prepaid currency cards are great for budgeting as consumers can only spend up to the value of funds that they load onto their card. Another advantage is that if lost, customers can have their card replaced, usually for a fee of around £10, with all the funds in tact."

Do you think consumers will end up using prepaid cards more than credit cards this holiday season?



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Thursday, December 10, 2009

Canadian Justice Minister Tries Eliminating Prepaid Gift Card Expiration Dates

CTV.ca reports that under new legislation tabled by Quebec Justice Minister Kathleen Weil, there will no longer be expiry dates on gift cards.

The new legislation ensures that gift cards will not gradually lose their value over time.

In some cases, companies choose to deduct an amount from a gift card's balance if the card is not used within a certain time frame.

Weil said the new law is necessary because the conditions attached to gift cards have been unfair to consumers.

What do you think about this development, will it pass?

Learn more: No more expiry dates for gift cards



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Tuesday, December 8, 2009

One World Ventures partners with eCommLink to offer Prepaid Solutions

CNNMoney highlights in this article that 1WorldCard will be working together with eCommLink to create and deploy prepaid solution and remittance programs. The relationship will merge the quick payment processing platform of eCommLink with 1WorldCard's prepaid cards.

This card will allow those without bank accounts to conveniently use their payroll cards instead of getting hit with high costs of check cashing. Steve Prior, CEO of One World Ventures mentions

"We are excited to be working with eCommLink, one of the premier processors of prepaid solutions. Our business model is to provide a wide range of much needed financial products that improve the quality of life for our cardholders and we believe the adaptive nature of the eCommLink platform will allow us to do that today and for the long term as well."



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Monday, December 7, 2009

IFX travel currency card – facts and figures

For individuals travelling throughout different countries, finding an affordable way to keep track of money exchanges can be difficult. IFX travel currency card offers individuals a way to track their spending and not worry about being robbed for their cash. Moneyhighstreet.com discusses the card, the IFX MasterCard Prepaid Currency card is available in Euro and US Dollar and can be used in 28 million locations worldwide, including over 1.5 million ATMs. Card members can manage your money abroad via SMS, online or by phone. It uses chip and pin for extra security and blocks reported stolen or lost cards.

The maximum balance for eccount is £5,000 and US Dollar and Euro cards are available on the same eccount.

What do you think about IFX travel currency card? Is it a good option for consumers?

IFX travel currency card – facts and figures



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Thursday, December 3, 2009

EA SPORTS Launches First-Ever Prepaid Debit Card with Rewards for Loyal Customers

Welt Online reports that EA Sports has partnered with Visa to launch their first-ever prepaid debit cards. According to the report, "Electronic Arts Inc. has made it easier for loyal gamers to buy their favorite EA SPORTS™ titles with the launch of the first-ever EA SPORTS branded prepaid debit card. The reloadable prepaid debit card enables users to receive a percent back from every purchase at thousands of brick-and-mortar and online retailers to redeem points that can be used to purchase select EA SPORTS game titles."

What do you think of the move by EA Sports? Will we see other game companies following suit?

EA SPORTS Launches First-Ever Prepaid Debit Card with Rewards for Loyal Customers



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Wednesday, December 2, 2009

Good News for Prepaid Cards?

DigitalTransactions.net sees a "sunny" forecast for prepaid cards as we continue with the tough economic climate. Says the article, "...But prepaid cards remain the one bright spot, according to a new market analysis from Mercator Advisory Group Inc. Maynard, Mass.-based Mercator’s latest annual forecast, for 2009-12, predicts that combined load volume on closed-loop and general-purpose, or open-loop, prepaid cards will hit $525.8 billion in 2012, up 112% from $247.6 billion last year."

For a more in-depth analysis of this forecast, please visit the original article.

The Latest Forecast Is Especially Sunny for Prepaid Cards

Do you think that Prepaid cards are set to flourish? What other factors may be contributing to the success of prepaid cards?



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Wednesday, November 25, 2009

Store Gift Card Sales Expected to Fall

Convenience Store News reports that the sale of private label store cards is expected to fall for the second straight year, while general-purpose gift card sales are expected to increase slightly, according to TowerGroup. Consumers are expected to exhibit more practical usage in each gift card category. For example, fast food will perform better than white linen dining, and discounters will perform better than high-end specialty stores. Niche players, such as local stores, will experience the largest negative impact.


What other factors are keeping consumers from private label store cards? Could the 2010 credit legislation be to blame?



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Tuesday, November 24, 2009

Secure Your Place to Meet President Bill Clinton at the Prepaid Expo USA

Prepaid Expo USA is excited to announce that a limited number of attendees will have the opportunity to take their photo with President Bill Clinton before his Keynote address on Monday, February 22nd. Secure your place among the 50 attendees that will be chosen from the drawing to meet President Clinton by registering for the Prepaid Expo USA 2010* by December 11th.

http://bit.ly/7pr9KP

President Clinton's keynote address at the Prepaid Expo USA 2010 is entitled "Embracing Our Common Humanity."

Following his time in office, President Clinton established the William J. Clinton Foundation to strengthen the capacity of people in the United States and throughout the world to meet the challenges of global interdependence. President Clinton also joined forces with President George H.W. Bush during the aftermath of three natural disasters - the 2004 tsunami in South Asia, where he served as U.N. Envoy for Tsunami Recovery, Hurricane Katrina in 2005, and Hurricane Ike in 2008 - to help raise money for recovery efforts.

President Clinton currently serves as the U.N. Envoy for Haiti to assist its people and government as they "build back better" from recent storm damages and implement their economic vision for the future.

All Prepaid Expo USA attendees registered and paid by December 11th will be automatically entered into a drawing for the chance to win a spot at the "Meet & Greet" with President Bill Clinton, Founder of the William J. Clinton Foundation & 42nd President of the United States. Limited spaces are available for this rare opportunity.

Additionally, register by December 11th with code XU2348LinkedIn2 and save $360 off the standard conference rate (10% discount off the prevailing rate).

http://bit.ly/7pr9KP

Don't miss this once in a lifetime opportunity to hear President Clinton speak live and attend the prepaid industry's largest and longest running event.

*To be entered into the drawing you must have registered and paid by December 11th, 2009.

Prepaid Expo Homepage

Download the brochure



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Saturday, November 21, 2009

It’s more than just technology

I’ve had some interesting conversations with a very innovative mobile technology company over the last few months. The group has built a pretty cool mobile payments platform which enables prepaid card issuers to essentially “bolt” on SMS based mobile banking services via a robust API. Almost all services made available through a traditional browser based online banking system such as balance inquiry, transaction history, deposit history and card-to-card transfers are accessible through a customizable set of SMS commands. The company’s strategy is simple – board as many new issuers to drive transaction volumes then enable inter-issuer transfers to dominate the money remittance space. WAIT! Say that again please. “Enable inter-issuer transfers”, says the savvy business owner.

This scenario represents the mindset of many new entrepreneurs in the prepaid space. The thought process is typically, “if we can technically do it, why not?” Based on the company’s strategy, it’s clear that at some point their platform will access APIs for dozens of issuers with the ability to sling value loads and unloads across multiple issuers like there’s no tomorrow. In theory it seems like a super deal. However, this represents a fast way for a prepaid related initiative like this to die in the start-up phase. It won’t matter how well you’re funded or how progressive the venture is.

Here are some reasons why:


- There is a difference between what each issuing bank, issuing processor and association will support. Banks and processors are governed by associations and federal guidelines in addition to internal policies. In some cases, the bank or processor may choose to not support initiatives fully endorsed by associations or the Feds as part of their respective business strategies.

- Card programs are highly compartmentalized. The issuing bank and association will approve a new program launch based on a set number of attributes. Everything ranging from program type (e.g. payroll, gift, general purpose) funding guidelines, authorization guidelines and KYC rules come in to play here. Launching a program with a set of attributes then doing something else will earn you a call from someone in the food chain. And it won’t be a warm and fuzzy call.

- Performing transactions on the issuer’s authorization host is only part of the puzzle. It’s all accounting entries followed by a physical movement of funds based on pre-established processes. For everything to work properly it’s ultra-critical to work within these processes. To transfer value from one issuer’s platform to another without considering the regulatory and business implications is suicide.

Here are some ways to help bring a vision like this to reality:

- First and foremost – understand the mindset of the institutions governing payment systems.

- Learn where the existing “rails” are and ride them when possible. Why recreate something if it already exists? If it’s not core to the business, piggy-back on someone that has already blazed the path. Your competitive advantage could be based on how you assemble existing infrastructure to meet a market need.

- Stop and look around frequently. Engage your issuing bank at all levels so you’re never considered a renegade or make costly mistakes.

Prepaid cards are starting look more and more like traditional demand deposit accounts in terms of how they are regulated. This means new players must understand the entire ecosystem to make it to first base. It’s more than just technology.

Randy San Nicolas is the author of Prepaid Enterprise. On his blog, Randy takes a look into the world of prepaid and all things payments, sharing his experiences and ideas.



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Tuesday, November 17, 2009

British Mogul Peter Jones's Data Select Debuts Prepay Card

MobileNews.com reports that Phones International boss Peter Jones (pictured) has waded into the new prepay cashcard market with the launch of the On-X MasterCard, which will be sold to various under-served demographics via his distribution company Data Select.

It expects sales of 40,000 units during the period.

The total UK prepay debit card market, which includes the gifting sector, will be worth £17 billion by 2010, said Data Select. Its principle target demographic is around eight million UK residents with no banking privileges.

Data Select Debuts Prepay Card



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Monday, November 16, 2009

How will the CARD Act impact the prepaid industry?

Recently, the prepaid industry has been under heavy scrutiny and with the addition of the Credit Card Accountability, Responsibility and Disclosure Act going into effect on February 22, 2010 even more provisions will apply to gift certificates, store gift cards and general-use prepaid cards. This article from Bankrate.com highlights how expiration and inactivity fees, for example, will be very limited. Customers can not incur inactivity fees on gift cards unless they go unused for a period of over 12 months.

There are however, certain fees that the CARD Act does not protect from like upfront issuance and sales fees. One aspect of fees that the CARD Act is particularly aiming to eliminate is expiration fees. The ACT demands that cards not expire for 5 years after its issuance; many gift cards at this time expire after 1 or 2 years.

What sort of changes do you foresee in the prepaid industry with these new provisions going into effect early next year?

Speakers at the Prepaid Expo USA 2010 will go more in depth into some of the legal and regulatory issues tackling the prepaid industry today. We have devoted an entire day to sifting through the details and helping you understand how the CARD Act will affect your business. Remember, if you’re planning to attend the Prepaid Expo USA event in Vegas this February make sure to mention code XU2348LinkedIn1 for a 10% discount off the prevailing conference rate. Hope to see you there!

Prepaid Expo Homepage

Download the brochure and take a look at Day 3 of the Expo agenda, which is entirely dedicated to Regulations

Register for Prepaid Expo – mention code XU2348LinkedIn1 for a 10% discount off the prevailing conference rate

NEW Special group pricing available this week only! Make sure to take advantage of this great offer.

Need more time for private meetings at the Expo? Contact our all new Prepaid Expo USA Meeting Concierge. If you are interested in Prepaid Meeting Concierge Services, please call +1.646.616.7605 or email us at PrepaidConcierge@prepaidexpousa.com to reserve your meeting space!



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Friday, November 13, 2009

New Jersey Senator looks to regulate prepaid cards

According to NJ.com, the Senate President Richard Codey is calling to regulate prepaid cards to operate with more transparency. While Obama has now imposed certain regulations on credit and gift cards, no new rulings have been made for debit cards.


The Senator looks at the fees associated with prepaid cards attacking the wrong demographic of people, "They turn to these prepaid debit cards as a means to get by," he said. "Instead, they end up sitting around helplessly as they watch their hard-earned money get eaten up by hidden fees."

Read the full article here.



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Tuesday, November 10, 2009

Western Union Introduces Holiday prepaid cards

Western Union is introducing a new prepaid card just in time for the holidays. The gift card includes a greeting card that can be used anytime throught the year. Customers can purchase this gift card by visiting wugift.com. Find out more about the Western Union gift card here.



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Friday, November 6, 2009

Spotlight on Prepaid Cards

A recent post from the Charlotte Observer highlights consumers are increasingly turning away from credit cards and bank accounts and moving to prepaid cards for their convenience of use, and that prepaid cards do not require credit checks. In 2008, consumers loaded $8.7 billion in prepaid cards, as opposed to $4 billion from the previous year. There is no doubt that the prepaid industry has grown significantly over the past couple of years.

College students make up a big percentage of prepaid card users. Industry experts only see this increasing even more since a new credit card law that will make it difficult for anyone under 21 to obtain a credit card without an adult co-signer will take effect in February. Congress is even taking a page from prepaid card's book by trying to pass legislation that would force banks to ask permission before overdrawing from their bank accounts.

Prepaid cards have recently come under federal scrutiny and many are arguing for more regulation in the prepaid industry. Do you agree that more regulation on prepaid cards will reduce fees?



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Monday, November 2, 2009

Univision’s New Card Offering Empowers Hispanic Community

Recently, Univision announced a strategic alliance with MasterCard Worldwide to introduce two new prepaid financial services, which include the Univision Prepaid MasterCard Card® and the Univision MasterCard Gift Card®. These prepaid cards will be released nationally in 2010 with the goal of providing Hispanic consumers with a safe, cost-effective alternative to using cash. According to studies conducted by the Center For Financial Services Innovation (CFSI), about 35.4 percent of the Hispanic population is unbanked -proving that a large segment of the minority community is heavily relying on cash. The partnership between Univision and MasterCard Worldwide seeks to aid in empowering the Hispanic community by providing easily accessible financial products.

Scott Scovel, General Manager of Financial Services at Univision will be speaking at the Prepaid Expo USA 2010 this February. Take some time to view our speaker line-up below and take advantage of the special priority code we’ve set up for our blog readers for 10% off the conference rate. Hope to see you in Las Vegas this February!

Prepaid Expo USA 2010

Prepaid Expo 2010 Brochure

Save 10% off the conference rate with priority code: XU2348UNIV
Prepaid Expo USA 2010 Registration



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Friday, October 30, 2009

Consumerist: The Hidden Cost Of PrePaid Debit Cards Revealed

The Consumerist writes today about the hidden cost of prepaid debit cards and the impact that these fees are having on the U.S. economy. Editor Ben Popken writes, with credit cards harder to come by and more annoying to use, the prepaid debit card market is projected to explode from $8.7 billion loaded on the cards to $119 billion in 2012, but a good chunk of that is going to be eaten up by hidden fees and gotchas. Popken gives a brief run-down on some normal costs.

$1.75 for each ATM withdrawal
$1 for each ATM balance inquiry
$.50 for each purchase
$4 monthly maintenance charge

As a prepaid card professional, what do you think of this analysis? We'd like to hear your thoughts.




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Thursday, October 29, 2009

Craig Fuller of TransCard Recognized as a Top Rising Star of Prepaid

This article in Enhanced Online News reports that CEO of TransCard Craig Fuller has been named as one of the Top Five Rising Stars of Prepaid by Paybefore Magazine. Paybefore's website allowed people to vote from mid-July to August, the five recipients of the award will be profiled in a fall 2009 issue of Paybefore magazine.

Craig Fuller, CEO of TransCard mentioned in response that:

“What is most important to me as a CEO in the prepaid industry is to never stop innovating and pushing the envelope. This is a rapidly expanding field and only companies that invest in the newest, most cutting-edge technology will make it. At TransCard, I am proud to be a part of a team that continually generates groundbreaking ideas and solutions. We will make any organization’s vision a reality.”



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Tuesday, October 27, 2009

Prepaid Card Use Rises

The Salt Lake Tribune reports that Prepaid card usage is up among Americans. Consumers typically buy them from a retailer, load them with money -- sometimes from directly deposited paychecks -- and use them at checkout counters or to pay bills online. And the cards are advertised with a phrase rarely used by financial institutions since the beginning of the credit crisis: no credit check necessary.


In 2008 consumers loaded $8.7 billion, up from about $4 billion the year before, on prepaid cards that carry Visa, MasterCard, American Express and Discover logos and can be used anywhere, according to Mercator Advisory Group, a research firm that focuses on the payments industry.

Consumer advocates warn that the cards can carry an assortment of fees. Nevertheless, prepaid cards have become popular among those who cannot get traditional bank accounts, many of them immigrants who rely heavily on more expensive check-cashing institutions.

For more information, please visit the original article here.



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Monday, October 26, 2009

Heartland Payment Systems and Hypercom Expands Payment Processing with Enriched Security

This recent article in reuters highlights Heartland Payment Systems and Hypercom Corporation's newest integration to offer high security payment systems to retailers nationwide and implement Heartland's E3 solution.

Heartland Chairman Bob Carr mentioned that security in payment transaction is very important to merchants, and that is exactly what the E3 solution offers, and with the help of Hypercom the solution will become more widely available to retailers. The software, Heartland Connect Gateway, will enable Hypercom POS systems to integrate the E3 solution, further protecting card data.



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Wednesday, October 21, 2009

Prepaid Expo USA 2010 Agenda Ready for Download, President Bill Clinton to Keynote

IIR is excited to announce two Prepaid Expo USA 2010 keynote speakers.

President Bill Clinton, Founder of the William J. Clinton Foundation & 42nd President of the United States will address the Prepaid Expo USA 2010, taking place February 22-24, 2010, in Las Vegas. President Clinton’s keynote address “Embracing Our Common Humanity” will take place on Monday, February 22nd at 2:30 pm.


Arkadi Kuhlmann, CEO of ING Direct, will also address the audience at the EXPO. His keynote will focus on driving success through innovation. Kuhlmann believes that in trying to re-energize an industry and transform a company, it's about creating a story. As the prepaid industry undergoes regulatory scrutiny, it continues to grow and transform. Through his experience at ING Direct, Kuhlmann will draw key parallels between the transformation of the prepaid industry and his experiences in the banking industry.

For more information on the Prepaid Expo USA 2010 keynotes, agenda, and full speaker line-up, visit the event website.

Prepaid Expo USA 2010:
http://bit.ly/qPHRZ

Prepaid Expo USA 2010 Brochure:
http://bit.ly/3ESlUY

Prepaid Expo USA 2010 Registration:
http://bit.ly/6MmaD

We look forward to seeing you in Vegas!

Sincerely,
Prepaid Expo USA



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Wednesday, October 14, 2009

Holiday Prepaid Cards Can Offer Relief from Money Exchange Fees

Moneyhighstreet.com reports today that research by FairFx.com, who supply foreign exchange currency cards, shows that travellers who buy their foreign currency at airports could pay significantly more than if they had planned ahead and ordered their cash online. Stephen Heath, Chief Executive of FairFX.com, said:“By preparing in advance and buying your currency online instead of using costly debit or credit cards for foreign spending, travellers will be able to get the most bang for their buck this half term.”

We see that these prepaid cards are big within the European market. Will money exchange prepaid cards take off in North America?


Holiday money is 14 percent cheaper when bought online



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Tuesday, October 13, 2009

FiCentive Partners with Redbank to Offer Prepaid Debit Cards

According to this article in bizjournals FiCentive has formed a partnership with a Mexican package and mail delivery company called Redpack to issue a line of prepaid debit cards that consumers can use to send money to friends and family living in Mexico.

FiCentive is taking this chance to gain a percentage of the unbanked market in Mexico. Sonia Bracamontes, sales and marketing director for Redpack mentions:

“This card program is designed to be of great value to the underserved market of the unbanked and underbanked Mexican community in the United States. We believe the Redpack brand is well-known and is trusted within this community and will therefore add significant credibility to the program.”



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Friday, October 9, 2009

Prepaid cards under fire for fees

In a recent research report done by the New York Times, they criticize the prepaid banking industry for continually charging their customers with fees on money they've earned. This documentary takes a special look at how hard it is to find out exactly what the fees are when one is considering a prepaid card. How can the prepaid banking industry more effectively communicate with potential customers about the way the prepaid banking card works?



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Tuesday, October 6, 2009

Prepaid cards doubted for number of fees

In an article at the New York Times recently, Andrew Martin looks at the current effects prepaid cards are having on the banking industry. The industry has really expanded over the past decade, and is a way for those who can't bank in the United States, which may be up to 80 million Americans. The article points out that once many customer easily obtain these cards, they are faced with many fees that may have been written in the small print. The fees begin at activation, and continue often through every deposit and withdraw, to every customer service call and monthly feeds from the card.

Congress has yet to examine the rules and regulations with these cards, and many consumer advocate groups are calling out against the numerous fees that often go unnoticed by the consumers until they add up to great amounts of the original deposit. Many companies are beginning to pay their consumers with prepaid cards if they don't have direct deposit, which also brings up some questions as to whether this is fair for consumers. With the introduction of WalMart's MoneyCard, which follows through on low fees for the consumer, fees are falling throughout the industry.

Prepaid cards may be the only choice for some of the users, as they have no real way to open a bank account and receive their income other than to preload it on this card. It can also be used as an option for money management. But now that consumers are calling for protection from the industry, how do you think this will evolve and change the industry? I think WalMart's new card, which does reduce the number of fees, will have an effect on the industry, but it is only a matter of time before Congress looks at the cards and begins to regulate them.



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Thursday, October 1, 2009

Prepaid cards increase as credit scores rise

Armen Hareyan has an interesting article about how the use of prepaid cards is going up as many of America's credit scores are going up. Prepaid cards offer their users a safe way to use credit cards, can teach teens about managing money responsibly, and don't affect credit scores and reports.

After the current recession is over, do you think prepaid cards will continue their rise in popularity? Now that Americans have had a reality check in credit, when the economy returns to a state that allows for more spending, will we see an increase in Americans who turn to prepaid cards as an increased avenue of spending?



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Wednesday, September 30, 2009

AMEX drops Gift Card Fees

American Express announced today that it will drop monthly fees associated with gift cards--effective immediately. The Washington Post says, the credit card law that President Obama signed in May prohibits gift cards from expiring for the first five years. Fees can't be assessed unless the card has been dormant for at least 12 months. The gift-card provision of the law takes effect in August 2010. Seeking to stay abreast of changes and to keep a good face with its customer's American Express has voluntarily eliminated its fees just shy of one year in advance.

Are other prepaid card or gift card providers to follow?



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Tuesday, September 29, 2009

Western Union Offers New Reloadable Prepaid Visa Cards

This post on Mobile-Financial.com highlights that Western Union now offers two fee-friendly reloadable Visa prepaid cards called the Western Union MoneyWise(TM) and Gold Card Visa prepaid cards. These cards do not carry monthly maintenance fees, purchase transaction fees, or customer service fees.

Tim Sloane, vice president client services and director Prepaid Advisory Service for Mercator Advisory Group mentioned:

"When you take into account activation, maintenance and transaction fees - among other costly additions - the typical reloadable prepaid card user can be charged upwards of $200 in fees over the course of a year. Western Union's new reloadable prepaid programs finally deliver the value proposition consumers have been long waiting for in this market."



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Monday, September 28, 2009

More rebates coming in the form of prepaid cards

According to CreditCards.com, 53% more of rebates are being placed on prepaid cards than in 2008. Many customers are not satisfied with this new rebate distribution method, as it doesn't allow them to deposit it, they are encouraged to spend it. For the many reasons companies are turning to prepaid sales cards include increased sales in stores.

While there are many perks for using prepaid cards to distribute rebate money, have you found a backlash from your customers if you've switched the way you give rebates? While giving a prepaid card does encourage a recipient to spend the money, is the reaction the same when a rebate is worth $10 as opposed to $100? Share your reactions with us.



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Friday, September 25, 2009

Prepaid cards replace checks as rebate payment of choice

Erica Sandberg of Creditcards.com reports that many businesses -- from office supply stores to wireless companies -- are switching to prepaid cards, and the reasons are multifold. One is the likelihood of boosted sales. According to rebate analyst Hal Stinchfield, CEO of Promotional Marketing Insights, a well-featured rebate card can result in "double-digit or sometimes triple-digit sales growth during the promotion period."

Has your company seen an increased growth in prepaid cards as rebates? We'd like to hear your thoughts.

Prepaid cards replace checks as rebate payment of choice



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Wednesday, September 23, 2009

The next BIG ONE


Tony Craddock, CEO of Giftex Prepay recently posted an interesting discussion topic in the LinkedIn group People in Prepaid. I thought it was a great topic and wanted to share Tony's post as well as my response. To view the entire thread visit the forum group via the link provided.


Tony's Post:
If corporate loaded prepaid is going to be such a big deal, what will come next after incentive, motivation and reward? Being in the prepaid business, you'll know that there are only three types of prepaid application: consumer loaded, corporate loaded and government loaded. Corporate loaded has been led by those lovely people in the incentive, motivation and reward industry. I'm looking forward to meeting with a few of the IMR industry's leaders at the MoShow in Chicago later this month. They have achieved a great deal with vouchers and cards already.

But I want to know what people in prepaid think is going the be the next Big One in corporate loaded prepaid. So kick off this discussion by sharing an example of a company or card that has used prepaid to solve a business problem. What was the idea? What was the benefit? Did it work? What did you learn? Go on. Take a moment out of your busy schedule and tap a reply. After all, you can’t have a ‘discussion group’ if its members don't discuss. Best wishes, Tony

My Response:
I think the "Next Big One" won't necessarily be a new product but an extension of existing products. Processors can extend the usefulness of prepaid products by supporting the inclusion or insertion of merchant level or market basket data in the financial authorization path. I think about verticals such as insurance, warranty, loyalty, and incentive. How would these organizations benefit from being able to take product or service level data from the point-of-sale and insert this information into the authorization path? Organizations would be able to extend authorization parameters beyond a simple "yes, there is enough money on the card for the transaction" or "no, there is not enough money on the card for the transaction."

Now the door opens up to new opportunities such as claims adjudication, direct marketing and data mining. I'm sure the list of things we can think of to do with gobs of purchase data goes on and on... The challenge for organizations will be understanding all the moving parts on the acquiring and issuing side including ecosystem dynamics, message formats, and everything else in the middle. It's a big mountain to climb but absolutely possible.

So what do you think will be the bext BIG One in prepaid?
Randy San Nicolas is the author of Prepaid Enterprise.



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Western Union introduces prepaid cards

According to The Banking Business Review, Western Union has introduced a new line of prepaid cards that have lower fees for its users. The card can be used anywhere, reloaded at any Western Union store and no monthly maintenance fees, purchase transaction fees or customer service fees. Read more here.



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Monday, September 21, 2009

Mercator's Latest Research Shows Growth in Open Loop Prepaid Card Market

This post from PR-Inside highlights how Mercator's 6th Annual Network Branded Prepaid Market Assessment shows that prepaid has been growing during the economic downturn and will continue to grow after as well.

Tim Sloane, Vice President of Client Services and Director of Mercator Advisory Group's Prepaid Advisory Service mentions:

"Mercator Advisory Group believes the prepaid industry will continue to show growth in 2009. However, being in the right channel with the right product is becoming critical to the growth of prepaid products and represents a significant volume opportunity for issuers. It is clear to Mercator that no other payments market is riding out the current economic downturn as effectively as prepaid and I can't think on any better payments market to be in during a recession."

Make sure to check out the post for some highlights of the full report.



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Thursday, September 17, 2009

Prepaid Debit Card vs. Big Bank

Sara Huffman of ConsumerAffairs.com decided to do an experiment using her "big bank" checking card and a prepaid debit card. Huffman chose a Silver Prepaid Mastercard, which promised free unlimited purchase transactions anywhere credit cards and debit cards are accepted, and most importantly, no overdraft fees. Huffman was approved for this card immediately.

One of the best features that Huffman discovered was, Two minutes after each purchase I got an email from Silver Card telling me I had made a purchase, how much the purchase was for, and best of all, how much money was left in my account. What a great feature!

We encourage you to read Huffman's entire account here.

And finally, from Huffman, While there is almost no truly free banking, using a prepaid credit card is an alternative to going with the Big Banks. It isn't for everyone, but if you get hit with multiple overdraft charges every month or so, you might find it's just as simple and much, much cheaper.

What did you think of Huffman's experiment? As a prepaid card professional, did you learn anything from her experiences?



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Wednesday, September 16, 2009

Intercash Launches New Prepaid Card Program

According to this article in PR.com Intercash has launched a new prepaid card design program which will be expected to be released in late 2009. Patrick Seguev, CEO of Intercash Europe mentions:

“We have been working hard to meet the demands of the prepaid industry and have come up with solutions that are until now unseen in this industry. With our new card’s features we have a product that is not only cost-effective, but will meet and exceed any merchant’s needs.”

Merchants will be able to load all Intercash cards issued by any participating merchant, something that they were not able to do before.



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Tuesday, September 15, 2009

Prepaid Expo Europe 2010 - call for case studies

Accepting Submissions for Case Study Presentations for the 2010 Prepaid Expo Europe April 7-9 2010 in Brussels

The 2010 Prepaid Expo Europe agenda and program are now being developed, and I am accepting proposals for specific case studies highlighting successful prepaid programs. If you’d like to be considered, please send an email with the following information to Andrew Borowiec at aborowiec@iirusa.com , by October 6, 2009 for consideration. Please note the following instructions:

I am looking for prepaid case studies from the following market segments:
• Retail and direct sellers (open & closed loop programs)
• Corporate-funded programs (loyalty, reward, rebate, incentive, promotion)
• Commercial applications (payroll, HR, administrative, sales & marketing support, etc.)
• Affinity programs (e.g. prepaid programs marketed toward affinity groups, inc. associations, colleges and universities, religious groups, etc.)
• Government programs (state and federal programs)
• Mobile payment applications (e.g. cell phone payments, airline tix, etc.)

For your proposal, please include the following information:
• Proposed description of your case study
• Your contact details
• Speakers full names, titles and companies (with full contact details; full address, phone, e-mail)
• Target audience for your session
• Specific details on the case study, including:
Background on the customer challenge and needs
Vendor selection process, including details on the criteria used to vet and choose vendors
Details on the program design, including goals and go-to-market strategy
Recap of program launch and operations to date
Discussion on program metrics, including results (is it profitable, does it support other organizational goals?)
Rough details on future direction of the program.

• Four-five benefits or takeaways the audience will leave with after attending the session indicating why attendees will be interested in the session
• Any other comments you’d like me to consider


Submission of an entry does not guarantee a spot on the agenda, nor does it mean the format you suggested will be used. Incomplete entries will not be considered. I will absolutely contact you if I am interested in learning more about your program. Thank you.


Regards,
Andrew Borowiec
Finance & Investments Division
Institute for International Research (IIR)
Direct Dial: +1 646 895 7468
Fax: +1 212 661 3708



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Prepaid Credit Cards are being used to move illegal funds to Mexico

According to this article in Aztarnet.com smugglers have been using prepaid cards to export illegal funds to Mexico. Arizona Attorney General Terry Goddard mentioned that currently there is no legislation or laws regulating prepaid credit cards, so launderers have done exported funds with incredible ease without violating any laws.

The Attorney General also stated that most of the cards are issued from offshore banks in the Dominican Republic, Panama, and the Cayman Islands. The problem with the cards is that they can be loaded up anonymously and so it can be harder to trace. He plans on creating legislation that would make carrying more than $10,000 across the border of Mexico on prepaid cards illegal. Looks like only time will tell if such a regulation will ever be passed in the near future.



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Tuesday, September 8, 2009

US Treasury Pushes to Deliver Social Security Benefits Through Prepaid Debit Cards

According to this post on the Chicago Tribune the US Treasury has been campaigning this year to get Social Security and Supplemental Security Income recipients to switch to a prepaid debit card. Currently, millions of Americans are getting a check from SS at the end of the month.

Every year the US Treasury receives about 1.4 million complaints from SS recipients, and so Direct Express is a safe, convenient way for recipients to get their government money without worrying about fraud. Sending prepaid cards instead of checks also saves the government a lot of money. 500,000 people so far have signed up to receive their government benefits through prepaid debit cards, but when will the rest of Americans join?



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Thursday, September 3, 2009

Prepaid cards might not be so bad for college students after all

We recently posted on our blog a POV from the Baltimore Sun that explains that prepaid cards might not be the best option for college students because of hidden fees. Today's post on the Baltimore Sun offers a different perspective on that opinion, mentioning that it unfairly portrayed the functions of a reloadable prepaid card.

In the post, the author specifies that credit cards can potentially carry the risk of debilitating debt for college students, if not used properly, and so prepaid cards are a much better option. ATM Fees and overdraft fees from debit cards are far more costly and expensive than prepaid card fees. Not to mention most of the fees on prepaid cards are dependent on the card holder's usage. What's your take on it?



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Wednesday, September 2, 2009

Owner of Virtual Works fined for misrepresenting prepaid cards

According to CreditCards.com, Joshua Finer, owner of VirtualWorks, misrepresented prepaid cards to his customers and was fined $52,000 by the FTC. Consumers who were applying for a loan or were lead to believe the card was free were actually charged $54.95 through a default setting by the online checkout's function. Read the full article here.



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Tuesday, September 1, 2009

SmartCard Marketing Systems Offers Prepaid Gift Card Options

The PayPers reports that SmartCard Marketing Systems is to market the prepaid gift cards via its Velocitymoney.com website. As a result of the deal, online customers can activate, load and select shipping options on the cards on their website. SmartCard Marketing Systems markets MasterCard and Visa-branded prepaid cards, as well as prepaid wireless and long-distance cards and payment processing services.



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Monday, August 31, 2009

VirtualWorks Settles for $52,000 with the FTC

According to this post on creditcards.com, VirtualWorks, A California-based credit card company has settled with the FTC for a sum of $52,000 for tricking customers into buying prepaid cards. Joshua Finer, the owner of VirtualWorks misrepresented his product to consumers by having them apply for a payday loan in which was disguised as "free", but then charged consumers a $54.95 prepaid card enrollment fee.

What are some other examples of deceptive marketing prepaid card schemes like this one that you've come across in through your endeavors?



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Friday, August 28, 2009

Fees remain high for prepaid cards

According to Consumer Loan Wire, in 2007, $4 billion was loaded onto prepaid cards. The number of fees associated with prepaid cards is high. According to the article, some cards cost up to $99 to activate and users are also faced with charges to call customer service. Read the full article here.



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Thursday, August 27, 2009

As Reloadable Cards Increase, Concerns Grow About Fees, Protection

Concerns are rising about the potential dangers of prepaid cards by individuals. A recent report by Jun,“Prepaid Cards: Second-Tier Bank Account Substitutes,” faults the cards for poorly disclosed, high, and widely varying fees, arguing the total monthly cost for usage should be capped. Among 18 reloadable cards examined, the report found activation fees ranging from $3 to $99.95; monthly fees from $2.95 to $10; and dormancy fees (levied by eight of the 18) from $1.95 to $9.95 per month. These and other fees, it says, should be laid out on card carriers in a standardized fashion not unlike the so-called Schumer boxes used by credit card issuers. The report further argues that charges for overdrafts should be eliminated. The report found 10 cards charging overdraft fees ranging from $24.90 to $29.

Should prepaid companies work with consumer advocacy groups to enhance the benefits of prepaid cards?

As Reloadable Cards Increase, Concerns Grow About Fees, Protection



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Wednesday, August 26, 2009

Prepaid Cards Might not be best for College Students

This post on the Baltimore Sun mentions that prepaid cards might not be the best option for college students trying to step away from owning credit cards. The reasoning behind this is because some prepaid cards carry "hidden" fees. Eileen Ambrose recently wrote in the Sun that perhaps another alternative would be to tie a debit card to a checking account, and once students can successfully manage that responsibility, to gradually move them into credit cards. Do you agree that prepaid cards are not the best option for college students?



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Tuesday, August 25, 2009

MasterCard Prepaid Cards

At Consumer Loanwire, they have a breakdown of the current prepaid cards available from MasterCard: The Everyday Prepaid Card, The MasterCard Prepaid Gift Card, and The MasterCard Travel Card. Read more about these three cards here.



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Monday, August 24, 2009

Same window pane, different view

Viewing the world through the same window pane doesn’t necessarily mean we’ll see the same things. Gray clouds could mean cool, relaxing weather to one person and to another, the end of the world. I’ve recently been involved in long discussions about what ‘Card Management’ is and what a Prepaid Card Management System (‘CMS’) is supposed to do. After a series of intense discussions with my colleagues (I could very well be the only one that saw the discussions as ‘intense’) I realized at many different levels, we were not only saying the same things, we were framing ideas based on our experiences in different verticals of the prepaid issuing space including issuing bank, acquirer and the prepaid third party processor.

This post will cover what I believe to be essential, high-level attributes of a solid Card Management System for prepaid issuance.

What is Card Management? The phrase ‘Card Management’ is actually an inaccurate use of words for someone that comes from the area of the prepaid space that requires the CMS to not only manage the life cycle of cards, but programs, products and business entities such as program managers and other sales channels associated with issued cards. I guess a more accurate phrase could be “Everything you need to run a prepaid business as a service provider or third party processor system.” That would make the acronym – EYNTRAPBAASPOTPPS. Thank goodness CMS is in play here!

Robust APIs CMS needs to interact with the authorization host to retrieve transaction data for business use. CMS will also need to communicate with external systems for supporting services such as ID verification, OFAC, card fulfillment, IVR and others. (may vary depending on program type i.e. payroll, gift, general purpose)

Hierarchy Management Being able to create an account, mail a card out, authorize a transaction and settle is as important as oxygen but is not all there is to the business of prepaid. Associating business entities at different levels enables business owners to analyze, measure and report on important portfolio data.

Program & Product Management Assigning hierarchy levels and product attributes from a single UI is important in my opinion. Think about how the business comes together starting at member sponsorship on through card issuance. Program and product configuration within CMS should be representative of this process.

Card Life Cycle Management Card issuance, account creation, account activation, self-service cardholder support, CSR support and alike. Everything that happens after all the business relationships and entities are in place.

Reporting and Billing In most cases this will happen in separate system but should be configured and delivered either through CMS or in partnership with CMS. Establishing fees, reporting revenue based on business entities is what brings it all together. Keep in mind that the reports I'm referring to are outside of what the authorization host typically delivers to the issuing bank as part of the third party processor's responsibility.

So there you have it. The world through my CMS window pane. What's your view?

Randy San Nicolas is the author of Prepaid Enterprise Blog.



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Friday, August 21, 2009

Great Online Exchange Rates Through Prepaid Cards

This article on Birghingham Post discusses that online exchange rates for 'Brits' might be at an all time best especially if they are thinking about traveling. Brits that are coming to America should take advantage of great rates which can approach $1.80 to the pound by Christmas. FairFx, a prepaid MasterCard that is available in euros and dollars currently has an exchange rate of $1.67 to the pound. Consumers should be able to lock a great rate through prepaid cards when exchange rates are to their favor. We should be seeing a lot more people taking advantage of these rates by the end of the year.



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Thursday, August 20, 2009

Chicago changing payment methods for public transportation

According to Chicago Now, the Chicago Transit Authority will stop issuing their current fare cards. Instead, they're looking to take up a partnership with a credit card company and the cost of producing the payment cards will fall upon the provider. According to the article, New York City's MTA has already done this with Citi Bank, who provided cards in 2007 on the Lexington Line. Read the full article here.



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Wednesday, August 19, 2009

Emida Announces New Prepaid Products and Upgraded Services

According to a press release, Emida customers across the U.S. will soon have three new and two enhanced products and services include Verifone POSA microbrowser access, enhanced PC terminal access, Prepaid Prepaid, money transfer and M-MONI™, Emida’s mobile wallet solution. Each of the new and enhanced services is designed to give Emida’s clients more flexibility, more value add and better customer retention. The new microbrowser application for Verifone POSA terminals allows merchants to run faster transactions, improving productivity and efficiency.

For more information about Emida, please click the company's website here.

Emida Announces New Prepaid Products and Upgraded Services



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Tuesday, August 18, 2009

Netspend Becomes Check City's Exclusive Debit Card Provider

According to latest release on Business Wire NetSpend and Check City has entered into an agreement in which NetSpend will be the chain's exclusive debit card provider. Both companies will also work together in converting customers that were previously served by using Check City's in house prepaid product to the new NetSpend card.

Dan Henry, CEO of Netspend has mentioned that “Our mission at NetSpend is to bring an unmatched set of financial services products to the tens of millions of consumers who are overlooked and underserved by traditional banks. By partnering with Check City—a company whose passion for top-quality customer service and exceptional products is as strong as ours—we are better able to deliver on that mission in the West and Mid-Atlantic regions.”



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Monday, August 17, 2009

Southeastern Baptist Theological Seminary's new ID cards include prepaid card

According to CR80News, Southeastern Baptist Theological Seminary of Wake Forest, North Carolina, will have new student IDs will now incorporate a prepaid card. The Southeastern iCash Card will allow students to purchase food and clothing on campus, use the card at the library and at other off campus stores having the function of a prepaid card. This card will be easily reloadable by both the students and their parents. Read the full article here.



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Friday, August 14, 2009

Prepaid Cards & High Fees

Mainstreet.com reports that prepaid card consumers should be careful, according to a new report conducted by Consumer Union, the nonprofit publisher of Consumer Reports. Here's a break down of the fees that can be associated with prepaid cards.

Activation Fees. 17 of the 18 prepaid cards charged a fee for getting started. The Millenium Advantage Card, for example, charges $99.95 in application and initiation fees.

Monthly Fees. Although sometimes this fee can be waved (if, for instance, direct deposit is established), 15 of the 18 prepaid cards charged a monthly fee, some as high as $10. ATM or Cash Withdrawing Fees. All cards charge some fee for ATM use, sometimes as much as $2.50. 17 of the prepaid cards will also charge you up to $1 for balance inquiries, and these charges do not factor in the ATM owner's own fees.

Inactivity Fees. Eight of the pre-paid cards charge a fee when you don't use your card for a period of time. Not using your Exact card this month? That will be $9.95, please.

The Fees add up: According to the report, a new Rush Card user whose first month card use included three ATM withdrawals, two deposits, three bill payments and eight regular purchases would pay $43.75 in fees.

Prepaid Cards: Beware of High Fees



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Thursday, August 13, 2009

Prepaid Credit Cards as an Alternative to Online Casinos

This article in USA Players discusses how many credit cards have the right to decline transactions as they see fit, for instance online gambling. Online casinos have noticed this, and as an alternative most do accept prepaid credit cards. The difference between the two is that with the prepaid credit card the funds have already been collected and so what you do with the money is at your discretion, unlike regular credit cards. This is why prepaid credit cards have been heavily favored by the Las Vegas Group, Cherry Red Casino, and many more online casinos.



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Wednesday, August 12, 2009

Consumers Gain Control of Finances with Prepaid Cards

According to this latest post on PRNewswire more and more consumers are turning over to using prepaid cards instead of credit cards in order to regain control of their finances once again. John Chaney, CEO of PreCash mentioned "Prepaid debit cards combine the best features of cash and credit cards. For consumers who are watching their budgets, the newest generation of prepaid cards are better than a credit card."

A recent study by Mercator shows that prepaid usage has nearly doubled from $4.2 billion to $7.2 million this year. With the economy at a low, the future seems bright for prepaid.



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Tuesday, August 11, 2009

Prepaid Currency Cards Offer Security

British citizens looking to lock in the the pound's 10 month high against the dollar now have an option with a prepaid currency card. According to MoneyHighStreet.com, with growing popularity, more currency card providers are now in the market, including Lloyds TSB, the Post Office, and specialist companies such as CaxtonFX or FairFX. Because the cards will hold their value, some British citizens can use them to protect themselves when the dollar matches or usurps the pound.

Will we see the popularity of prepaid currency cards spread?

Lock in great rates with a prepaid currency card



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Monday, August 10, 2009

Heartland Payment Systems Offers New Prepaid Services

According to this article in BusinessWire Heartland Payment Systems, which is one the the biggest payment processors, will now include a prepaid calling service offering wireless and long-distance minutes.

Customers will be able to use the ePIN It! program to quickly and conveniently access their minutes by using the same POS terminals that they already use for credit/debit transactions. It will be interesting to see if other payment processors will go this route as well.



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Thursday, August 6, 2009

Prosa Tackles Mexican Prepaid Card Market

The Wall Street Journal reports that prepaid card issuer, Prosa is about to take hold of the Mexican prepaid card market. Prosa's shareholders include some of the country's largest banks. HSBC Mexico, Grupo Financiero Banorte SAB (GFNORTE.MX), Banco Invex, Grupo Financiero Santander SAB (SANMEX.MX) and Grupo Scotiabank each own 19.7% of the firm, with state-run bank Banjercito holding the rest. Prosa Chief Executive Jose Molina sees untapped potential for prepaid products like store gift cards, prepaid debit cards and payroll cards that businesses can use to pay employees.

Mexican Electronic Payments Co Prosa Sees Growth In Card Mkt



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Wednesday, August 5, 2009

Phones4u Releases MasterCard Prepaid Cards

According to this article in mad.co.uk the mobile retailer Phones4u will be launching two MasterCard prepaid cards to target ethnic minorities and lower socio-economic communities with the Escape Card, and 13-18 year old consumers with the Neon Card.

The prepaid cards are expected to be launched across its 450 stores in the UK and Phones4u is aiming to sell roughly 10,000-12,000 prepaid cards every month. The mobile retailer is offering an incentive for signing up. The loyalty rewards program features shopping rewards for iTunes, Next, Curry, Look and Lovefilm. The Neon Card will prevent young consumers from purchasing alcohol, gaming, and adult content while the Escape Card will be able to send friends and families money overseas without paying a transfer fee.



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Tuesday, August 4, 2009

San Francisco Transit links up through prepaid card

According to the San Francisco Chronicle, the new TransLink Fare Card, which is now being used on many of the major forms of public transportation in San Francisco. The prepaid fare card was able to begin being use don Sunday, which makes the four major transportation hubs using this prepaid card the BART, the San Francisco Municipal Railway, AC Transit and the Golden Gate Ferry. The transit cards are prepaid, then the fares are deducted as used by the traveler. Read more here.



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Monday, August 3, 2009

InComm and Cartoon Network Partner on New Gaming Card

According to a press release, InComm has partnered with Cartoon Network to distribute prepaid cards for their AAA, browser-based massively multiplayer online game (MMOG), FusionFall. Cards are now available for purchase at select locations of major InComm retail partners including WalMart, Toys"R"Us, FYE, Suncoast, and will be rolling out to GameStop locations next week. FusionFall prepaid cards will be available in more than 17,000 retail locations nationwide this summer.

InComm and Cartoon Network Partner on New Gaming Card



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Friday, July 31, 2009

TSYS Wins Several Processing Contracts in China

American Banker reports that TSYS has partnered with China's only credit card network and landed five processing contracts with issuers in China and Malaysia. TSYS mentioned last week that China UnionPay Data Services Co will process credit card transactions for the following companies Yaodu Credit Cooperative, Shandong Provincial City Commercial Banks Alliance, Yunan Rural Credit Union and Guangxi Beibu Gulf Bank. It will also handle prepaid card payments for KargoCard Sdn Bhd. This is only the beginning of what TSYS hopes to a pathway into the rest of Asia. Where do you see the prepaid industry headed into Asia?



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Thursday, July 30, 2009

Current Prepaid Card for teens

According to The Sun's Financial Diary, there is a new prepaid card from Discover that can help parents and teens work together to control their spending. This prepaid debit card allows the parents to set limits on spending, as well as restrict what for and where their children can shop. Read more about this new card here.



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Tuesday, July 28, 2009

TxVia raises $15.5 Million in Series C Financing

According to this article in SiliconIndia prepaid card processing company TxVia has raised $15.5 million in series C financing which was led by Bain Capital Ventures and other investors.

Anil D. Aggarwal, Chairman and CEO of TxVia mentions, "We continue to enable the prepaid card industry and set new standards of excellence in processing."

TxVia deploys a PaaS approach to prepaid card processing that comes complete with application development, data storage, and other tools. It will be interesting to see how this investment will improve on their technology.



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Monday, July 27, 2009

Prepaid cards lead to better loyalty systems

The Intelligent Enterprise recently wrote an article taking a look at how prepaid cards have replaced loyalty programs and allowed them to become better at tracking their customers as well as better reward them by monitoring the purchasing habits of the card user. It also allows for companies to judge the shopping habits of regions, as they can compare the prepaid card habits of users at one store to others. Read the full article here.



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Friday, July 24, 2009

Prepaid card overcharged

Lydia Alcock, a teen who has been using a prepaid card to manage her money, was hit with a staggering fee of $23,148,855,308,184,500, after buying a train ticket from Grand Central. Alcock along with 12,000 people saw this bank error on their statements last month. Visa was responsible for the overcharge, and has since voided all fees that came with the charge that is 2,000 times what the US government owes. Read the full article here.



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Thursday, July 23, 2009

TxVia Raises $15.5M with Bain Capital Ventures

According to a Press Release, TxVia, Inc., a pioneer in prepaid card processing technology, today announced it has raised $15.5 million in Series C financing, led by new investor, Bain Capital Ventures. Also participating were all current institutional investors, including Espírito Santo Ventures, High Peaks Venture Partners and Village Ventures. New York City Investment Fund joined as a new co-investor.

The funding follows important milestones for TxVia, including successful large-scale client deployments of the company’s groundbreaking platform-as-a-service (PaaS) delivery model for prepaid card processing. Today, TxVia has more than five million reloadable and nonreloadable cards on file in both B2B and B2C prepaid applications.

What do you think of the investment by Bain Capital to TxVia? What other companies will this influence within the prepaid card arena?





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Wednesday, July 22, 2009

Need a taxi?

Taxi On Demand, a new prepaid card, designed specifically to pay for a taxi, will allow customers to connect with a taxi, no matter where they are in the United States. A toll free number on the back of the card will allow the user to be connected with a taxi driver in the vicinity. In addition, the prepaid card will only work on taxi services, and will be declined if used for anything else. Read the full article here.



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Tuesday, July 21, 2009

$23 Quadrillion Visa Charges Reported in Several Locations

According to this article in NewsTimes.com there are several incidents of a huge charges appearing in Visa prepaid debit cards across the nation. Karen Taylor from Bethel recently found a $23 quadrillion charge on her 17 year old son's prepaid debit card. Josh Muszynksi of New Hampshire found a $23,148,855,308,184,500 charge on his account shortly after purchasing a pack of cigarettes at a gas station. There are other reported incidents in Texas and Tennessee as well. Apparently Visa released a statement last week of discrepancies that were caused by programming errors and impacted less than 13,000 Visa prepaid transactions. These are the sort of errors the prepaid industry must avoid in order to gain the consumer's confidence to spend in this economy.



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Accepting Submissions for Case Study Presentations for the 2010 Prepaid Expo USA

The 2010 Prepaid Expo USA agenda and program are now being developed, and I am accepting proposals for specific case studies highlighting successful prepaid programs. If you’d like to be considered, please send an email with the following information to kkirkpatrick@iirusa.com, by August 4, 2009 for consideration. Please note the following instructions:


I am looking for prepaid case studies from the following market segments:
· Retail and direct sellers (open & closed loop programs)
· Corporate-funded programs (loyalty, reward, rebate, incentive, promotion)
· Commercial applications (payroll, HR, administrative, sales & marketing support, etc.)
· Affinity programs (e.g. prepaid programs marketed toward affinity groups, inc. associations, colleges and universities, religious groups, etc.)
· Government programs (state and federal programs)
· Mobile payment applications (e.g. cell phone payments, airline tix, etc.)


For your proposal, please include the following information:

· Proposed description of your case study
· Your contact details
· Speakers full names, titles and companies (with full contact details; full address, phone, e-mail)
· Target audience for your session
· Specific details on the case study, including:


Ø Background on the customer challenge and needs
Ø Vendor selection process, including details on the criteria used to vet and choose vendors
Ø Details on the program design, including goals and go-to-market strategy
Ø Recap of program launch and operations to date
Ø Discussion on program metrics, including results (is it profitable, does it support other organizational goals?)
Ø Rough details on future direction of the program.

· Four-five benefits or takeaways the audience will leave with after attending the session indicating why attendees will be interested in the session
· Any other comments you’d like me to consider


Submission of an entry does not guarantee a spot on the agenda, nor does it mean the format you suggested will be used. Incomplete entries will not be considered. I will absolutely contact you if I am interested in learning more about your program.


Regards,

Keith Kirkpatrick
Global Prepaid Event Director
+1 (646) 895-7348
kkirkpatrick@iirusa.com



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Monday, July 20, 2009

O2 readies prepaid credit card

Mobile News reports that O2 has partnered with NatWest bank for the launch of O2 Money to provide prepaid credit cards. The first products from O2 Money (a British banking institution) will be two Visa prepaid cards which will be available to O2 customers.Customers will receive balance updates on their mobile and will be able to choose between the Cash Manager card which works as a typical prepaid credit card or the Load & Go card which is available to users as young as 13.

O2 readies prepaid credit card



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Friday, July 17, 2009

Popularity of prepaid cards could lead to fraud

According to the Fair Issacs Corporation, the growing popularity of prepaid cards could lead to more fraud. It could come in the form of counterfeit cards, lost or stolen cards and pins. What are some of the measures that can be taken to avoid prepaid cards from becoming a major source of fraud?



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Thursday, July 16, 2009

Fiserv Announces New Card Designs

According to this article in Finextra the financial services solutions provider Fiserv has unveiled 78 exclusive designs ranging from lifestyle themes, money motifs, and regional images for its cards. Many financial institutions will begin to offer these designs as a way of boosting usage and activation. But should prepaid card companies really be focused on the design of cards as opposed to other, maybe more important aspects of the card?



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Tuesday, July 14, 2009

Visa and Urban Trust Bank partner for prepaid card

According to the Orlando Business Journal, Urban Trust Bank has partnered with Visa to begin offering prepaid cards at the banks branches in both Florida and Maryland. The card will be called the Urban Trust Success Card.

The cards are designed for those who now rely on cash or who face difficulties obtaining traditional bank and credit card accounts.

Source



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Monday, July 13, 2009

Credit Card Companies are Building Pyschological Profiles of Their Customers

This article in the Consumerist explains that credit scores and credit reports might not be the only criteria credit card companies are using to evaluate your risk as a customer. In fact, all purchases and behavior while accessing the credit card will be used by bank personnel to re-evaluate your potential risk.

Will this spawn more users to opt for prepaid cards instead?



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Friday, July 10, 2009

Prepaid Reloadable General Purpose Cards Expected to Reach 160 Billion USD in Latin America by 2015

This article in The Paypers discusses how the prepaid general-purpose reloadable cards are expected to reach about 160 billion USD in Latin America by 2015. These mobile reloadable cards are usually connected to mobile and utility services that allows consumers to pay for electricity bills via SMS texting, the internet, and by other means. What are some companies that are beginning to take advantage of this trend?



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Thursday, July 9, 2009

State vs federal laws and prepaid cards

At the Wall Street Journal, they look at the new regulations that are going to allow state laws for prepaid cards the impact the way the cards work nationwide. Consumer groups believe that prepaid card holders shouldn't receive less protection than other cardholders, and there is a possibility that soon state consumer laws could trump federal, in which case state laws are more stringent. So how do we find a balance with state and federal laws that strikes a balance between consumer protection and still encourages financial innovation?



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Wednesday, July 8, 2009

Prepaid Card Fees are Being Dropped

This article in This is Money highlights that many prepaid cards are becoming cheaper to use, followed by Caxton FX's recent removal of their cash withdrawal fee.

While other companies have not yet removed their cash withdrawal fees, many have lowered the rate. The cheapest prepaid cards after Caxton FX comes from Barclays, FairFX, Lloyds TSB, the Post Office, Ice, Thomas Cook and Travelex. It will be interesting to see how this will progress over the next couple of years.



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Tuesday, July 7, 2009

Canadian Firm Offering Prepaid Card Aimed at Muslims

David Morrison of Credit Union Times reports that UM Financial Inc., has begun offering a prepaid card aimed at Muslims who wish to have the convenience of a credit card but refrain from paying any interest. Islamic religious law forbids the paying or earning of interest.

Faithful Muslims can use traditional credit cards without violating Islamic law but need to make sure they pay off their balances in a timely manner to avoid any interest charges. Omar Kalair, CEO of UM Financial Group, said he came up with the prepaid card after it became clear that many Muslims inadvertently wind up paying interest charges on traditional cards.



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Monday, July 6, 2009

New prepaid game card for consumers

Payspan, a company that makes prepaid cards for use on the web when buying items for online games, virtual worlds and social networks, has expanded to sell their cards in Brazil and Turkey. The Ultimate Game Card is sold can be used for over 1,000 different games online. Read the full article here.



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Thursday, July 2, 2009

Western Union provides cardholders with Visa Gold Card feature

Kara Deniz of eCommerce Journal reports that, Western Union on Thursday revealed its intention to strengthen its global consumer loyalty program, The Western Union® Gold Card, with the convenience of a reloadable Visa® prepaid card. The new service is to be offered from July and targeted 8 million Western Union Gold Card loyalty members in the USA. The Western Union Gold Card Visa® Prepaid Card benefits are Prepaid Benefits and Gold Card Benefits.

Deniz also reports that according to a recent Western Union research, around 25% of American consumers responded they are using cash more often than they have in the past; 88% said an important reason they use cash is to avoid high interest rates and fees charged by credit card companies; and 91% say it is important for them to use cash more often as it help them to avoid building credit card debt.

Will Western Union see a surge in customers with their partnership with Visa?



Western Union provides cardholders with Visa Gold Card feature



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Wednesday, July 1, 2009

TransCard Launches Pulse Network

This latest release in BusinessWire highlights that TransCard has launched the Pulse network, which will provide more locations for cardholders to use their cards.

The Pulse network extends to more than 289,000 ATMs and 4,500 financial institutions across the United States. TransCard’s President Jerry Uffner mentions:

“Adding a new PIN POS network will increase the scope of card acceptance and cardholder use. We are always working to improve our products, give cardholders more ways to use their cards and, ultimately, provide more cardholder value.”

This launch will make lives easier for its existing cardholders.



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Tuesday, June 30, 2009

Springbok Services introduces new prepaid cards for billpay

According to Banking Business Review, Springbok Services has created a new system to help companies manage their payrolls via prepaid cards. enPay prepaid payroll cards and Springbok Bill Pay are two new systems that will allow employees and users to leverage their prepaid cards to the fullest extent.

Employers can customize their enPay prepaid payroll card, distribute the enPay cards to employees, and then upload funds directly to the payroll card to pay salaries, reimburse out-of-pocket expenses, pay bonuses and commissions, or fulfill termination payments.

Read the full article here.



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Monday, June 29, 2009

Consumer Advocates Want Prepaid Card Restrictions

Kristina Peterson of WSJ/Yahoo Finance reports that new credit card legislation enacted by President Obama is not set to cover prepaid cards. Peterson reports that, "Consumer advocates want to change that. They are urging the Federal Reserve to strengthen guidelines affecting prepaid cards from companies such as Inc., Green Dot Corp., NetSpend Corp. and Inc. while the Obama administrations focus remains concentrated on regulating the credit-card and banking industries. Unlike credit cards, prepaid reloadable cards aren't covered by the federal statutes that protect credit-card holders from fraud or limit their losses when cards are lost or stolen. Though many prepaid card companies do offer some consumer protections, they do so voluntarily. "

Should more restrictions and consumer protection be placed on prepaid cards?

A Push to Regulate Prepaid Cards



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Friday, June 26, 2009

smartOne Prepaid Solutions renews contract with Metavante Corp

According to Enhanced Online News, smartOne Prepaid Solution has renewed its prepaid card processing agreement with Metavante Corp.

Scott McCormack, vice president, First National Bank of Omaha, stated:
“Metavante delivers the processing stability and scale we need to facilitate the growth of our smartOne Prepaid Solutions offerings, as well as the flexibility to quickly offer new functionality. Shared core values between our two companies are at the heart of our relationship, and those shared values allow us to quickly enhance our offerings to meet the needs of the prepaid marketplace.”

Read the full article here.



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Wednesday, June 24, 2009

Consumer advocates urging government to take stand on prepaid card guidelines

According to the Dow Jones Newswire, the new law recently signed by Obama does not protect prepaid card holders. Consumer advocates are encouraging the Federal Reserve to strengthen their guidelines around prepaid cards. Currently, there is nothing holding prepaid card issuers from fraud or loosing their funds. Read the full article here.



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Tuesday, June 23, 2009

Travelex Launches Prepaid MasterCard

According to this article in BTN Online Travelex has launched a prepaid card in conjunction with MasterCard that will allow corporations to save money and enhance controls when traveling internationally.

Travelex's Corporate Cash Passport Tool is loaded with US dollars and is accepted at ATMs and vendors that accept MasterCard products globally. Corporations can use these cards to set spending limits and budgets for its employees. This card also eliminates costs associated with currency exchange fees by reducing the amount of money that will need to be exchanged. This card has already sparked interest in big corporations like Virgin Atlantic and British Airways just to name a few.



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Friday, June 19, 2009

Prepaid Visa Card for Romanians

Maria Bruno-Britz of Banktech.com reports that Romania's Raiffeisen Bank and RevEurope are launching a prepaid Visa card that will allow users to send money domestically from their mobile phones. The Raiffeisen Bank Visa Prepaid Card is the first prepaid card issued by a bank in that country, according to a release. The card is designed for young and cash-based Romanians who are online. Customers who buy and load cash on the card can shop online, make purchases anywhere Visa debit cards are accepted, withdraw cash from ATMs worldwide and use the integrated YAP mobile service to send money domestically to friends and family, or check balances from their mobile phones with a text message.

What other prepaid cards are being offered in Eastern Europe? Have there been any case studies that attest to the success of these cards?

Let us know on Twitter.



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Wednesday, June 17, 2009

Surge in prepaid card sales

Convince Store Decisions looks at the current upswing in convince stores are seeing in the sales of prepaid cards. In addition to prepaid cards for calling overseas, companies have seen an increase in mobile phone cards an gift cards for fuel brands. Read the complete article here.



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Monday, June 15, 2009

Hiten Card Chooses Actress Saumya Tandon to be Brand Ambassador for Hiten Prepaid Mastercard

According to this latest press release Hiten Cards Limited have signed Saumya Tandon, host for “Dance India Dance”, to be the brand ambassador for the hiten Prepaid MasterCard® Card. Saumya Tandon is delighted to get involved with hiten as she mentions, "When I was introduced to this product I was eager to get involved,the hiten Prepaid MasterCard product allows families to share money with each other and family is very important to me.”

It will be interesting to see what other prepaid card companies will use celebrities to endorse their cards.



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Thursday, June 11, 2009

Coinstar Gets Into Social Gaming; Will Sell Prepaid Game Cards For Facebook, Others

Tameka Kee of Yahoo Finance reported last week that Coinstar, well-known for its coin counting machines, will now go into the business of prepaid gaming cards. The cards will be for use in social gaming, including cards for games and apps on Facebook.

According to Kee's report, Coinstar, which recently acquired DVD-rental kiosk-maker Redbox, inked deals with game companies like WildTangent, Spare Change and Aeria Games to offer the cards; buyers will be able to use them for subscriptions and tokens on casual games sites, to buy goods in virtual worlds (and in social games on Facebook and MySpace), as well as for massively multiplayer online (MMO) games.

For more information, please visit the original Yahoo Finance article here.



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Wednesday, June 10, 2009

nFinanSe and Walmart Head to Head in Reloadable Prepaid Card Pricing

This article in Convenience Store News highlights how nFinanSe has lowered the price of its reloadable prepaid to $3 from $5.95, to match a change Walmart had previously announced of lowering its reloadable prepaid card to $3 from $8.94.

The goal, according to Jerry R. Welch, chairman and CEO of nFinanSe,is to encourage mass usage. It is estimated that the reloadable prepaid marketplace will double to $14 million by 2014.



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Tuesday, June 9, 2009

Prepay Solutions opens in Turkey

Hurriyet Daily News looks at the new company Prepay Solutions, based in Turkey, which opened to provide services to companies who want to enhance their services by offering prepaid solutions.

The company offers services in a few different areas:
-"B to C" gifting
-"B to B," referring to gifts for employees, clients or partners
- Government benefits
- Insurance claims

Read the full article here.



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Thursday, June 4, 2009

Prepaid cards for green

According to the San Antonio Business Journal, SmartCard Marketing Systems Inc will issue an environmentally conscious prepaid debit card. With each sale of the prepaid card, a portion of the proceeds will go to an environmentally friendly cause.

Prepaid Card CEO Chris Ingram says
“We have identified a definite interest in our large customer base for environmental causes. We are very excited about this special sales campaign with the VelocityMoney Prepaid Card. We are partnering with several major environmental organizations on this program.”



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Tuesday, June 2, 2009

Futura's Mobile Text Messaging Offering Catches Wave

PRNewswire reports in this release that Futura Card Services announced that its mobile text messaging banking powered by Metavante Mobile Financial Services in fourth quarter 2008 has proved to be a strong value-add to its product suite.

Brad Golden, President of Futura, realized that text messaging is a huge form of communication in today's society, and so the company needed to offer real-time information to consumers. This offering has come into play during a crucial time, since 56 percent of consumers claim to be monitoring their finances more closely. The text messaging platform allows consumers to have instant access to their card balance and transaction history. I look forward to other prepaid providers to roll out similar programs across the board.



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Thursday, May 28, 2009

Prepaid Cards Offers the Best Deal in Foreign Currency

This latest post on compareandsave.com discusses how many Britons are failing to realize that they will save more money purchasing foreign currency if they use prepaid credit cards, according to FairFx. Stephen Heath, FairFx's CEO, mentions "Will 2009 be the year that travellers wake up to the savings they can make by using a prepaid card for all their holiday spending?" Do you think we will see more and more Britons use prepaid cards for their foreign currency purchases?



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Wednesday, May 27, 2009

Could banks increase customers by improving prepaid services?

According to Digital Transactions, they addressed the fact that banks could bring in more customers if they improved their prepaid card services.

According to the article, "They found that customers on average cashed 28% of their checks over the preceding three months at banks, 53% at check-cashing outlets, and 19% at other locations such as retail stores. Some 53% of the respondents had a checking account at the time of the survey, 21% didn’t but had one in the past, and only 26% never had a checking account. Those with checking accounts cashed 34% of their checks at banks."

Read the full article here.



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Tuesday, May 26, 2009

SmartCard creates environmental line of prepaid debit cards

According to the San Antonio Business Journal, the “Go Green, friends of the environment” version of SmartCard’s VelocityMoney Prepaid Debit Card...The Go Green version of the card will allow a portion of the proceeds of the sale of the debit card to go toward environmental causes."

With the emphasis on "green," will SmartCard see a healthy profit by appealing to a different sector of prepaid card users? We'd like to hear your thoughts.

SmartCard creates environmental line of prepaid debit cards



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Thursday, May 21, 2009

FNDS Sold Atlantic Merchant Service

FDNS 3000 has sold Atlas Merchant Services due to the settlement with the former owner of Atlas LLC.

John Hancock, Chief Executive Officer, stated:
"Management's strategic review concluded that the Atlas subsidiary was unlikely to provide significant financial contributions or synergies, and that both companies would fare better under separate ownership."

They will turn their focus to the prepaid card industry. Read the full article here.



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Wednesday, May 20, 2009

MoneyGram and AccountNow to launch Visa-branded prepaid card

Banking Business Review reports that, MoneyGram International, a provider of payment services, and AccountNow, a provider of financial solutions, have signed an agreement to launch the new MoneyGram AccountNow Prepaid Visa card, which will be available at select MoneyGram agent locations starting in June 2009



The MoneyGram AccountNow Prepaid Visa card will participate in the Visa ReadyLink, Interlink and Plus networks. No credit or bank account is necessary for card holders to load cash at any MoneyGram agent location, and consumers can use the card everywhere Visa debit is accepted, said MoneyGram International.



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Monday, May 18, 2009

First Prepaid Cards in Japan

According to Global Atlanta, TSYS will begin to provide Japan with its first prepaid cards in July. Travel Bank Inc will provide these cards.

TSYS International President Gaylon Jowers Jr. stated this about the new cards, “Prepaid cards are a trusted alternative to travelers’ checks in many countries, and the number of issuers that are interested in prepaid cards is increasing worldwide."

Read the full article here.



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Thursday, May 14, 2009

Tips to Avoid Unemployment Prepaid Card Fees

I came across this interesting post on creditcards.com that details several steps an individual should take to reduce unemployment prepaid card fees. With more than 6 million unemployment insurance recipients in the U.S., I thought that this was important information for our readers. Here are the steps detailed by LaRita Heet:

1. Just because it looks like a debit card ... doesn't mean it is a debit card, even though the terms "debit card" and "prepaid card" are sometimes used interchangeably, according to Jennifer Tramontana, director of communications for NBPCA. "Unemployment benefits cards are prepaid cards that are issued by a bank. They look just like a debit card or credit card, but they are a network branded prepaid card," she says. Prepaid card accounts differ from a debit cards in that debit card funds are typically withdrawn against money in your checking account. Prepaid cards are preloaded with a set amount of cash and generally have numerous fees and restrictions.

2. Read the instructions. You should never skip the fine print, but this is particularly true of your unemployment prepaid card literature. "When consumers take a few minutes to read the welcome kit that comes with the card, they can virtually eliminate all surcharges and can immediately take advantage of the numerous benefits that come with these cards, including immediate availability of funds, fraud and loss prevention and cost-savings," says Trusko.

3. Follow the rules. Most UI card issuers allow a set number of free ATM withdrawals per pay period (usually one or two). Plan ahead to withdraw enough money to last so you don't get stuck with withdrawal fees later in the week.

4. Take advantage of free services. Some states, including Maryland and Kansas, and their issuing banks offer free online account management and free phone transfers. However, don't assume anything is free -- check the literature to be certain.

5. Look before you leap. Consider choosing the "direct deposit" unemployment payment option over the UI prepaid card -- and have your money immediately deposited into your regular bank account, where available.

6. Withdraw the money and deposit it into your bank account. Depositing unemployment funds into your regular account means avoiding unnecessary fees and having to keep track of your finances, says Kelly Phillips. "The only disadvantage to this is that U.S. Bank is not my bank, so in order to avoid the fee, I have to go there first, and then go take the cash to my bank -- and the reason that we do that is because you don't get a statement," she says. Because most UI accounts, including those at U.S. Bank, do not offer account statements or free online banking, budgeting can become a nightmare.

7. Stick to what you know. Phillips adds that some UI recipients do not have their own personal bank accounts and are accustomed to using cash for everything. "If you just normally lead a cash life, then continue to do it that way, especially if you're not used to having a prepaid card," she says.

8. Set up an automatic transfer. "I would suggest setting up an auto-transfer so that any time money lands on the card, it is automatically transferred to a banking account of your choice. Then, in essence, it's just like direct deposit," says Lisa K.

Take a look at the full post here.



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