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Prepaid card offerings are a win-win

By Patti Murphy Expanded use of prepaid cards
ProScribes Inc. Apparently, I'm not alone in purchasing prepaid gift cards
for my own use. "Americans are finding more and more
'm a big fan of prepaid cards, especially gift cards. uses for prepaid cards in their lives," said Peter Reville,
They make gifting an easier proposition, especially director of primary research at Mercator Advisory Group.
around the holidays. But I also regularly purchase "The greatest opportunity is likely to come from how these
I them for myself. You see, there's a grocery chain in consumers are using prepaid cards for themselves rather
my area that has a sweet rewards program. Money spent than for gifts."
on groceries, prescriptions and gift cards add up toward
money off on gas purchases at the chain's gas stations. Reville is the author of a new report titled Prepaid Cards:
Continued Growth, which indicates growth in most categories
The stores offer a wide assortment of gift cards – for of prepaid cards has exceeded 100 percent over the last six
everything from fast food establishments to airlines – and years. Growth in prepaid transit cards, for example, was
I often purchase gift cards there before making purchases 130 percent between 2013 and 2019, Reville found. Growth
elsewhere. A few years ago, I was able to get two free fill- in prepaid phone cards has been 113 percent since 2013 and
ups of my rather large truck just from points collected general purpose reloadable prepaid cards have grown by
purchasing Home Depot gift cards to pay for some home 100 percent, he reported.
renovations.
"Prepaid companies need to focus on the different use
I also use reloadable prepaid cards, particularly when cases both for buying and funding, as well as redeeming to
buying online or at gas stations that are not yet EMV keep up with the evolving use of these cards," Reville said.
compliant. (The odds of breaches compromising my credit
and debit card information at these businesses are too high Younger consumers are particularly keen on prepaid
for my tastes.) cards, Reville reported, with seven out of 10 consumers
under the age of 45 buying prepaid cards, compared with
just five out of 10 consumers over the age of 45. Younger
consumers also are more likely to redeem prepaid cards
One of the most striking findings online than in stores. Among those between the ages of 18
and 34, 74 percent reported redeeming gift cards online; 64
reported by Fiserv is that 90 percent percent reported redeeming gift cards at brick-and-mortar
of consumers who receive gift cards establishments. Overall, 66 percent of consumers redeem
gift cards online, and 73 percent redeem gift cards at brick-
for a small business they haven't and-mortar stores, according to Reville's report.
shopped at said they would shop at Big benefits for small businesses
those businesses and return after A separate study, just released by Fiserv, points to significant

using their gift cards. benefits for small businesses offering gift cards. "Small
business owners have a tremendous opportunity to boost
revenue, foster customer loyalty, and strengthen their brand
by investing in gift card programs," said Dom Morea, senior
vice president, prepaid solutions, at Fiserv. "Gift cards are

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