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Data for today’s episode is provided by Mercator Advisory Group’s report – North American PaymentsInsights: Prepaid Cards: Shifting Purchase Channels
Prepaid Card Trends by Age and Income:
- Overall, 18-24 year olds are the most likely (76%) to purchase prepaid cards, followed closely by 24-44 year olds (73%).
- In contrast, only 45% of 65+ year olds purchased a prepaid card in the last year.
- Similarly, there’s a large drop-off between the 46% of 25-44 year olds who had prepaid cards delivered ‘virtually’ or ‘digitally,’ compared to the 23% of 45-64 years olds who did so.
- Only 3% of 65+ year olds had prepaid cards delivered to a digital wallet, compared to 35% of 18-24 year olds.
- Understandably, households earning >$100K+ are most likely to have purchased Retailer Gift Cards, at 56%.
- Households earning $75<$100K lead those >$100K in general purpose gift card purchases, gaming and music prepaid, and prepaid phone card purchases.
- Like most surveys, it’s difficult to accurately represent the underbanked portion of the population, who are likely users of certain types of prepaid cards.
Mercator Advisory Group’s most recent Insight Summary Report, Prepaid Cards: Shifting Purchase Channels, from the bi-annual North American PaymentsInsights Survey Series reveals continued growth of reloadable cards in the United States. Furthermore, the purchase channels for many types of prepaid cards (closed-loop gift, open-loop gift, open-loop reloadable, gaming, phone and transit) are also shifting, particularly in the area of online purchasing.
Prepaid Cards: Shifting Purchase Channels, the latest Insight Summary Report from Mercator Advisory Group’s Primary Data Service, is based on a sample of 3,001 U.S. adults surveyed in the annual online Payments survey of Mercator’s North American PaymentsInsights Survey Series, conducted in June 2020.
The study highlights consumers’ use and interest in prepaid cards and, in particular, store cards, general purpose (or open-loop) cards and general purpose reloadable cards. The report explores where consumers buy and redeem prepaid cards, whether the cards are purchased for themselves or as gifts, how the cards are used, sources of funds for the cards, and other key aspects of prepaid cards in consumers’ lives.
“The prepaid market is changing with neo and challenger banks, use of reloadable prepaid cards, and more governments and corporations issuing prepaid cards instead of checks for disbursements of all types. That said, the use of gift cards continues to be strong, particularly online,” stated the author of the report, Peter Reville, director of Primary Data Services at Mercator Advisory Group, which includes the North American PaymentsInsights Survey Series.