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Prepaid Card Market: Payment Trends, Market Dynamics, and Forecasts 2020 - 2025

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  • 51 Pages
  • January 2020
  • Region: Global
  • Mind Commerce
  • ID: 4901449
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Virtual Cards rApidly Gaining Ground on Physical in the Prepaid Card Market

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Despite the dominant trend towards mobile and contactless payments, the prepaid card market remains vibrant and dynamic. In certain parts of the world, physical cards remain the preferred mechanism for payments along with cash. In the United States, prepaid cards remain the preferred choice for the unbanked market segment as well as the market for “under the table” transactions.

However, the US government is increasingly clamping down on illegal activities with broad measures of investigation and enforcement. Some market segments prefer to use physical cards in certain situations. Surprisingly, the millennial generation has a high affinity towards certain cards, especially designer offerings as they appeal to their sense of style.

There is a robust market for both closed-loop and open-loop prepaid cards. In the case of the former, major merchants leverage prepaid cards as a means of furthering brand identity and driving additional sales such as the gifting market. In addition, the unbanked market often turns to cards as a means of conducting non-cash, debit transactions.

Closed-loop cards are getting increasingly creative in terms of how they position themselves within the overall payments ecosystem. This is an interesting dynamic as the same companies are also pushing hard for next-generation mobile payments and wireless wallet infrastructure.

The move towards a cashless society is substantial, further driving the prepaid card market. However, we see a transition from physical cards (credit and debit) towards completely virtual. This will not happen without continual improvements in identity management, privacy, and security measures.

This will disenfranchise many consumers globally that are unbanked, underbanked, credit challenged, and/or working “under the table”. Our related research into Next Generation Payments (via smartphones, wearables, and implantable technology) indicates that a universal wallet will be an absolute requirement. We also see this reinforced by the need for a graceful transformation of the prepaid card market.

This report evaluates the major driving factors for prepaid card ownership and usage. The report evaluates usage market segment including demographic profile, card type, and industry vs. government programs. The report assesses retail challenges relative to shopping and related card usage.

The report also analyzes the payments ecosystem including issues related to mobile payments in contrast to physical card usage. The report also provides forecasts for 2020 to 2025 covering all major areas including corporate usage, retail, and government.

Target Audience:

  • POS device providers
  • Mobile commerce companies
  • Merchant banks and financial processors
  • Government agencies and regulatory authorities
  • All providers of goods and services (instore and online)

Select Report Findings:

  • Prepaid card demand remains strong for youth, unbanked, and underbanked segments
  • Stricter anti-money regulations are anticipated in United States paralleling those in EU
  • Virtual prepaid cards are rapidly gaining traction in conjunction with online spending habits
  • Alternative currencies will be increasingly used in lieu of prepaid cards for certain purchases
  • Steady growth through 2025 to benefit data services providers and financial intermediaries

With the purchase of this report at the Multi-user License or greater level, you will have access to one hour with an expert analyst who will help you link key findings in the report to the business issues you're addressing. This will need to be used within three months of purchase.

This report also includes a complimentary Excel file with data from the report for purchasers at the Site License or greater level.

Table of Contents

1 Executive Summary2 Introduction
3 Banking Impacts Payment Flexibility
3.1 The Unbanked and Underbanked Segments
3.1.1 High costs
3.1.2 Convenience
3.1.3 Need to Instant Funding
3.1.4 Lack of Knowledge
3.1.5 Identification Requirements
3.1.6 Poor Banking History
3.1.7 Overall Perceptions of Banking Relationships
3.2 Payment Models
3.2.1 Operator-Centric Model
3.2.2 Bank-Centric Model:
3.2.3 Peer-to-Peer Model:
3.2.4 Collaboration Model:
3.3 Mobile Payment Methods
3.3.1 Premium SMS based transactional payments
3.3.2 Direct Mobile Billing
3.3.3 Mobile Web Payments
3.3.4 Contactless (NFC)
3.4 Unbanked / Underbanked Population
3.4.1 Unbanked Population
3.4.2 Underbanked Population
4 Payments Ecosystem Challenges
4.1 Economic Issues
4.2 Multiple-Nationalities
4.3 Banking Accounts
4.4 Cost Factors
4.5 Security Issues
5 Payments for the Unbanked Segment
5.1 Overview
5.2 Unbanked/Underbanked Population in United States
5.2.1 Low-Income Population
5.2.2 Unemployed Population
5.2.3 Under-Educated Population
6 Retail Challenges Impacting Commerce and Payments
6.1 Retail Demand Depends on the Economy
6.2 Industry Concentration
6.3 Seasonal Cash Flow
6.4 Crime-Related Losses
6.5 Protecting Customer Information
6.6 Trends Affect Demand
6.7 High Worker Turnover
6.8 Changing Buyers Need
7 Online Shopping Challenges and Opportunities
7.1 The Rise of High-Tech Shopping
7.1.1 Consumers are in Control
7.1.2 Comparison Shopping
7.2 Most Vulnerable Products
7.2.1 White Goods
7.2.2 Gray Area Products
7.2.3 Clothes and Accessories
7.3 Wireless Challenges at the Point of Sale
7.3.1 Mobile Is Both a Curse and a Cure for Showrooming
7.3.2 Where People Using Primarily Wireless
7.3.3 Mobile Influence
7.4 Shopping with Smartphone Trends
8 Merchant Strategies
8.1 Embrace rather than Fight against the Current Trend
8.2 Offer Unique Products
8.3 Offer In-Store Reviews
8.4 Focus on Brand
8.5 Enable and Empower In-store Shoppers
8.6 Digitize Your Store and Your Employees
9 Convert Shoppers into Buyers
9.1 Boost Loyalty and Sales
9.2 Personalizing the Shopping Experience
9.3 Analyzing Data
9.4 Figuring Out the Potential of Mobile Devices
9.5 Embracing Social Media
10 Data Solutions to Support the Strategies
10.1 Finding the Easy Data
10.2 Getting at "Hidden Data"
10.3 Mining "Big Data"
11 Strategies for Checkout and Point of Payment
11.1 Keep Form Filling To Bare Minimum
11.2 Organize the Checkout into Stages
11.3 Add Progress Step Links or Back Buttons
11.4 Utilize Familiar Mobile UI Elements
11.5 Enable Guest Checkouts
11.6 Offer Quick Payment Options
11.7 Remove Distractions
11.8 Provide Security Reassurances
11.9 Take Advantage of Geolocation
11.10 Keep It Lightweight
12 Prepaid Cards Market Forecasts 2020 - 2025
12.1 Aggregated Market 2020 - 2025
12.2 Regional Markets for Prepaid Cards 2020 - 2025
12.3 Prepaid Markets by End User Segment 2020 - 2025
12.3.1 Prepaid Card Markets for Retail Markets by Segments 2020 - 2025
12.3.2 Prepaid Card Markets for Corporate Markets by Segments 2020 - 2025
12.3.3 Prepaid Card Markets for Government and Institutional Use 2020 - 2025
12.4 Prepaid Cards by Demographics 2020 - 2025
List of Tables
Table 1: Prepaid Card Load Volume vs. Transactional Value 2020 - 2025
Table 2: Prepaid Cards in Use Globally 2020 - 2025
Table 3: Prepaid Cards in Use by Region 2020 - 2025
Table 4: Prepaid Card Market Value by Region 2020 - 2025
Table 5: Prepaid Cards In Use by End User Segment 2020 - 2025
Table 6: Prepaid Card Market Value by End-User Segment 2020 - 2025
Table 7: Prepaid Cards in Use by Retail Market Segment 2020 - 2025
Table 8: Prepaid Card Market Value by Retail Segment 2020 - 2025
Table 9: Prepaid Card Markets in Use by Corporate Segment 2020 - 2025
Table 10: Prepaid Card Market Value by Corporate Segment 2020 - 2025
Table 11: Prepaid Card in Use for Government and Institutional Use 2020 - 2025
Table 12: Prepaid Card Market Value for Government and Institutions Segment 2020 - 2025
Table 13: Prepaid Cards in Use by Demographic Segment 2020 - 2025
Table 14: Prepaid Card Market Value by Demographic Segment 2020 - 2025