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Table of Contents

Lead Story

The United States of microfinance

Patti Murphy
The Takoma Group


Industry Update

FDIC to seek public input on financial reform rules

Are thermal paper receipts toxic?

PCI SSC summarizes changes to upcoming standards


Research Rundown

Breaches across America
Installment three

Selling Prepaid

Prepaid in brief

Getting started in prepaid

Barry J. Kessler

King of the 'plastic' jungle


The Dodd-Frank Act: What it might mean for issuers and acquirers

Mark Brady and Ross Federgreen
CSRSI, The Payment Advisors

Respect yourself, elevate our profession: Quit selling on price

Jeffrey Shavitz
Charge Card Systems Inc.

Patent, patent, who's got a patent?

Brandes Elitch
CrossCheck Inc.


Street SmartsSM:
Riding the merchant chargeback learning curve

Ken Musante
Eureka Payments LLC

Use three basic desires to your marketing advantage

Daniel Wadleigh
Marketing Consultant

Assignment provisions in ISO and agent agreements

Adam Atlas
Attorney at Law

Social media and the MWAA

Peggy Bekavac Olson
Strategic Marketing

A primer on PCI scans

Tim Cranny
Panoptic Security Inc.

Considering consequences improves results

Jeff Fortney
Clearent LLC

Company Profile

SignatureLink Inc.

New Products

Data management for ISOs, merchants

Nucleus Platform


Organize your life for peace of mind


2010 Calendar of events



Resource Guide


A Bigger Thing

The Green Sheet Online Edition

September 13, 2010  •  Issue 10:09:01

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Getting started in prepaid

By Barry J. Kessler

Editor's Note: This article originally appeared in GSQ, Vol. 13, No. 2, June 2010.

Reloadable, open-loop, network-branded prepaid cards are big business, as evidenced by the July 21, 2010, initial public offering of Green Dot Corp., which raised approximately $164 million in its first day of trading.

With the success of Green Dot and others, stakeholders in the merchant channel are taking increased notice of opportunities in prepaid - from selling cards to customizing programs. These opportunities can take many forms, each with varying levels of investment, product control and economic return, and the decision process can be daunting.

Here is a primer to help you develop a strategic plan, establish the requisite relationships and execute your plan for maximum benefit.

Speaking 'prepaid'

The prepaid space is still relatively new, and terminology can be confusing or often misapplied. So let's make sure we're speaking the same language.

The network-affiliated banks (issuers) that issue reloadable prepaid cards typically contract with third-party partners (program managers) to operate and market prepaid programs.

Under these arrangements, program managers must use certified, issuer-integrated processing partners (called issuing processors or more simply processors), and these processors must be distinguished from acquiring processors that route card transactions for authorization.

The issuer submits the program to its affiliated network for approval. Once approved, the issuer supplies the program manager with a designated set of card numbers (the bank identification number, or BIN) for which the program manager assumes financial and compliance responsibilities.

The processor then sets up the program on its platform, identifying the assigned BIN, establishing the authorization parameters, storing cardholder registration and card account transaction data, maintaining card account balances, and providing card authorization, cardholder support and other program-connected services.

Exploring options

Your prepaid options are simple. You can build and operate your own product for maximum control; engage a program manager to fully customize and manage your solution; or manage product sales channels for a single program manager or an aggregation of program managers.

Or you can retail pre-labeled or private-labeled, off-the-shelf cards for commission. You determine your right choice by your market access and available capital resources, both financial and human.

Proceed with caution

The road to prepaid gold can be long and bumpy. Here are a few guidelines to help make the ride smoother.

So there you have it. Apply these basic tenets to your niche, and you're ready to chart your own path in the prepaid world and enjoy the wealth of opportunities this fast-growing market offers.

For more stories from SellingPrepaid E-Magazine, as well as breaking news and forums devoted to the prepaid sphere, please visit

Barry J. Kessler is CEO and President of Prepaid Resources Inc. He has developed, launched and managed many successful prepaid debit card programs during his career, and is considered an industry leader in the general-purpose, reloadable prepaid card segment.

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

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