The Debanked: A US$1 Billion Prepaid Debit Card Opportunity
Report Summary
The Debanked: A US$1 Billion Prepaid Debit Card Opportunity
A new segment of consumers—the “Debanked”—presents a US$1 billion revenue opportunity to providers of prepaid debit cards.
Boston, February 9, 2012 – A new report from Aite Group defines a new segment of consumers—the “Debanked”—and describes the market opportunity this segment represents for prepaid debit card providers like Green Dot, NetSpend, Walmart, and others. Based on a February and March 2011 Aite Group survey of 500 U.S. consumers of alternative financial services, the report provides demographic information on the Debanked and explains how debit card providers can capitalize on the Debanked opportunity.
Recent U.S. banking regulation has put significant pressure on banks’ revenue and fees, and many banks have responded by increasing or creating fees on their products and services. The unforeseen backlash, however, has been the emergence of the Debanked—a new segment of consumers who are looking to escape the traditional banking system not because they have to, but because they want to. The segment is growing and represents a significant threat to banks’ revenue at a time when banks can ill afford to lose customers. At the same time, Debanked consumers present a significant opportunity to prepaid debit card providers that can appeal to this segment through the right product offering and marketing approach.
“While the Unbanked are often misperceived as disadvantaged consumers living outside mainstream society, the Debanked are anything but underprivileged,” says Ron Shevlin, senior analyst with Aite Group and co-author of this report. “Furthermore, convincing the Debanked to use prepaid debit cards shouldn’t require a lot of education or persuasion. The Debanked are already highly satisfied and frequent users of this product.”
This 16-page Impact Note contains eight figures and five tables. Clients of Aite Group’s Retail Banking service can download the report.