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.

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).

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 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 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 to reserve your meeting space!

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Friday, November 13, 2009

New Jersey Senator looks to regulate prepaid cards

According to, 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 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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