Prepaid cards represent a new payment form, making significant inroads into the UK payments infrastructure.  They are payment cards known as a prepaid cards (sometimes wrongly referred to as prepaid credit cards, or prepaid debit cards).

Prepaid cards present our partners with a fresh new opportunity to; 

•    Serve existing customers
•    Reach out to new market segments
•    Improve their brand recognition
•    Increase customer loyalty

In the travel sector, the prepaid payment cards can be used instead of holiday money previously taken as travellers cheques, or foreign money.  In the corporate world, the pre pay cards act as a payroll cards, in the retail market as prepaid gift cards, and in the cyberworld as prepaid internet cards.  Further uses are still being developed.

Prepaid cards further the evolution of the card payment business from the “pay later” of credit and the “pay now” of debit, to the “pay before” of prepaid.  

Prepaid cards are easy for consumers to understand and use. The consumer determines the cashcard spending limit by adding money directly to the account.  firstprepay cards can then be re-loaded with additional money as needed via online, Post Office or PayPoint channels. Just as mobile phone top up cards are used to load cash on to them, prepaid cards are used in the same way. Funds from a prepaid cash card can also be accessed via ATM, PIN POS, and signature POS delivery channels. The prepaid solution offers tremendous flexibility, convenience, and spending control.

In the United States, consumers have quickly adopted prepaid cards. Two out of three U.S. consumers have purchased a prepaid card in the past year. With the popularity of prepaid cards on the rise, estimates predict that prepaid cards will carry over $100 billion in value in the coming year. By 2008, the value of U.S. prepaid card transactions is expected to top $185 billion.

This phenomenon is now hitting the UK and Europe with FirstPrepay leading the market with a range of programmes for partners such as Ministry of Sound, Extreme Sports, talkSPORT and Club 18-30's.

Two types of prepaid cards are available through FirstPrepay, “open loop” and “closed loop.” Open loop prepaid cards carry a payment network badge such as Visa, Visa Electron, Maestro® or MasterCard®, and are accepted wherever these signs are displayed. Closed loop prepaid cards are sold by merchants and are used exclusively for payments at their locations. Either open or closed loop cards may have a re-loadable feature, depending on the issuer’s design functionality.

Prepaid Card Segment Marketing Opportunities
Re-loadable open loop prepaid cards present an opportunity to use targeted marketing to enhance member relationships and reach new members. Rather than trying to reach all members with one card, open loop prepaid cards allow your business to offer targeted products to meet specific member needs. Open loop prepaid technology is being applied to a broad spectrum of payment cards including:
•    Everyday spending reloadable
•    Travel Cards (travellers cheque replacement)
•    Payroll Cards
•    Insurance Payout
•    Transport
•    Benefits Payments.
•    Gift Cards

Along with the opportunity to develop and build member relationships, open loop prepaid cards also present a new revenue model. Unlike debit and credit cards, open loop prepaid revenue is earned primarily from issuance and service fees and is devoid of interest revenue.

If you would like to discuss a partnership with FirstPrepay, please see the contact us section.