A survey of small U.S. businesses said merchants are more likely to fund businesses via prepaid debit cards than with payday loans. The National Small Business Association's 2012 Small Business Access to Capital Survey said 13 percent of survey respondents were more inclined to use prepaid cards as a funding tool over the last two years, compared to only 1 percent of respondents who were likely to use payday loans in the same time frame.
According to the online survey of 300 small-business NSBA members conducted in May 2012, 27 percent of respondents had changed banks over the last four years, with 38 percent of them citing mistreatment by banks as being the biggest reason businesses switched. This dissatisfaction with banks suggests prepaid card providers have an opportunity to reach small businesses with loan products tied to prepaid cards.
The U.S. Department of the Treasury said 95 percent of individuals who receive monthly Social Security payments via MasterCard Worldwide-branded Direct Express prepaid cards are satisfied with the service. Additionally, 93 percent of cardholders would recommend the card to others, according to the KRC Research survey commissioned by MasterCard on behalf of the Treasury's Financial Management Service.
The survey was conducted by telephone in June 2012, when 1,211 randomly picked Direct Express cardholders were interviewed. It revealed that over 3 million benefit recipients are using the Direct Express cards, but that approximately 6 million Social Security payments are still distributed on paper checks every month. With the March 1, 2013, deadline approaching when all federal benefits will be paid electronically, the Treasury is working to convince check recipients why they should switch to Direct Express.
The Center for Financial Services Innovation reported that over 400 entries were received for the MyMoneyAppUp Challenge. The challenge, a partnership between the CFSI, the Treasury and the Doorways to Dreams Fund, is a contest designed to discover next-generation mobile applications for the financially underserved in the United States.
The MyMoneyAppUp Challenge was broken up into two parts – IdeaBank and App Design Challenge. IdeaBank, which called for the best app ideas, with winners to receive cash prizes ranging from $250 to $1,000, received 316 entries. The App Design Challenge asked for comprehensive app design proposals and received 98 entries; winners are up for $2,500 to $10,000 in cash awards. The contest officially closed to entrants on Aug. 12, 2012. An awards ceremony will take place in late September in Washington.
Digital gifting company Giftango Corp. achieved Payment Card Industry (PCI) Data Security Standard (DSS) Level 1 certification. Giftango said the certification reflects the company's commitment to data security.
NetSpend Holdings Inc. reported a strong second quarter 2012, with revenues of $85.3 million, up 15 percent over the $74.4 million it made in the second quarter of 2011. Over that same period, the number of active cards with direct deposit went up 24 percent, to 957,000 as of June 30 with the percentage of active cards with direct deposit up six points to 43 percent.
Online video and phone call provider Skype launched prepaid Skype Cards in Mexico. Skype, which is a Microsoft Corp. company, cited the Central Bank of Mexico in saying that a "large majority of the Mexican community" do not have access to credit cards – a main payment option to purchase Skype services online.
Gift card exchange operator Plastic Jungle Inc. joined with prepaid card distributor InComm and its open virtual currency subsidiary Zeevex to allow consumers to use gift cards to purchase online games, music, movies and other digital content. The scheme allows online gaming and digital content publishers to translate funds on closed-loop, retailer-specific gift cards into Zeevex currency via Plastic Jungle's interface and network.
Prepaid Resources LLC will offer its automated direct deposit enrollment and management technology, BenefitsDirect, on Blackhawk Network's Visa-branded PayPower prepaid cards. PayPower cardholders will be able to have federal benefit payments directly deposited onto their cards.
Prepaid card program manager White Eagle (Europe) PLC teamed with identification card provider CitizenCard Ltd. to deliver to the U.K. market what is being called the first photo ID prepaid card. The Visa Inc.-branded, general purpose, reloadable CitizenCard is designed to provide identity and age verification services for young people who also need an electronic payment card.
Campus card processor CardSmith acquired Vision Database Systems Inc. to add card production and verification capabilities to its campus card program. As part of the agreement, VDS will become a wholly owned subsidiary of CardSmith and continue operations from Jupiter, Fla.
Check guarantee company Chexar Networks Inc. completed its acquisition of remote deposit capture (RDC) provider Clear Payments Inc. The companies formerly partnered on a mobile RDC solution for the unbanked.
In conjunction with Card Express Inc.'s launch of the MasterCard-branded AIR Virtual Prepaid Code, CardEx appointed Steven Ascher as Vice President of Business Development. Ascher formerly managed prepaid initiatives at Alltel Wireless Communications Corp. He will be responsible for managing CardEx's sales and business development activities.
Payza appointed Alastair Graham as Chief Executive Officer. Prior to joining Payza, Graham was founder and director of payment consultancy 5 Grams of Plastic. Graham said Payza has grown over 300 percent in the last three years.
Prepaid card processor Ceridian Stored Values Solutions named Jackie Reynolds as Business Development Manager for the U.K. and Ireland. Reynolds formerly was National Business Manager at Sodexo Motivation Solutions.
Teen rewards card provider edō Interactive appointed Keith B. Smith to Executive Vice President and General Manager of Partner Content. Smith, who was Senior Vice President of Sales at Firethorn Holdings LLC, will drive edo's growth strategy in the small and midsize business market.
Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.Prev Next