Mercator Perspectives

Would You Use Your Card?

Prepaid cards are enjoying an unprecedented level of interest as consumers look to them as a way to manage money or replace traditional accounts, governments and business explore using them to cut costs, and financial institutions look at them as a way to replace lost revenue. There have been a variety of new products coming to the market and more are being designed every day.

As companies think about launching new products, the members of the product design team should ask themselves whether or not they would use the card they are planning to offer. In looking at terms and conditions, it seems as if sometimes cards are designed in a vacuum or with no real sense of who the end user might be. While prepaid cards often seem transferable from one purpose to another, the ability to customize fees, features, and functions should play a role in every design process.

This is particularly important when thinking about designing cards for the ever-popular unbanked/underbanked market. A college student without a bank account who is using the card as an easy way to get student loan disbursements and money from home is a much different customer than a single mother with a payroll card. Facilities like Internet and smartphone access, access to fee-free ATMs, and the ability to pay billers electronically cannot be taken as givens. These markets are not homogenous.

Even something as simple as a gift card may not be as simple as it seems. I once intervened on behalf of a poor drug store clerk who was being badgered over why a gift card purchased at her store did not work at the gas pump. I am sure the explanation was in the disclosure that came with the card, but there is no guarantee this cardholder ever saw it or read it.

Ultimately, prepaid card providers should validate their assumptions about the target market for their cards. They should test their ideas, and ultimately, they should try using their cards as if they were one of their own customers. The results may lead to adjustments and new ideas on how to improve the card and win more customers.

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