Prepaid Debit and Payroll Cards: Winning in the Void
Report Summary
Prepaid Debit and Payroll Cards: Winning in the Void
The prepaid debit and payroll card industry is destined for unprecedented growth, filling a void at the bottom of the consumer financial services market.
Boston, MA, September 15, 2010 – A new report from Aite Group, based on dozens of Aite Group interviews with industry participants, provides a strategic overview of the prepaid debit and payroll card market. The report sizes the market, forecasts its growth, and evaluates opportunities for prepaid debit and payroll card providers to fill the void at the bottom of the U.S. consumer financial services market.
The prepaid debit and payroll card industry is emerging as a formidable force in U.S. consumer financial services. The launch of an ambitious payroll card program by Walmart in 2009, the successful IPO of Green Dot in 2010, and NetSpend’s subsequent filing for an IPO have been historic milestones for the industry. Dollar volumes for the combined products reached US$43 billion in 2009, a number Aite Group expects to rise to US$164 billion for 2014. Multiple factors over the past few years — including the housing market bust, financial crisis, economic downturn, surge in unemployment, and large numbers of consumers defaulting on their debt — have contributed to the elimination of mainstream financial institutions in the low end of the market. The prepaid debit and payroll card industry is uniquely positioned to fill this void; prepaid debit and payroll cards represent a compelling alternative to consumers shut out of checking accounts and credit cards.
“Many banks still fail to recognize the formidable threat and opportunity represented by prepaid debit cards,” says Gwenn Bézard, research director with Aite Group and author of this report. “For those banks that have remained on the sidelines, now is the time to develop a plan.”
The report references the following companies: AccountNow, ADP, American Express, Bank of America, Billeo, BillFloat, Blackhawk Network, Capital One, Comdata, Citigroup, Discover, First Data, FIS, Fiserv, FSV Payments, Global Cash Card, Green Dot, Heartland Payment Systems, H&R Block, HSBC, JPMorgan Chase, InComm, InteliSpend, MasterCard, Metabank, MoneyGram, MPower, NetSpend (and Skylight), PayChex, PayPal, Poste Italiane, PreCash, Plastyc, Protective Draft Credit, Springbok Services, SunTrust, TransCard, TSYS, TxVia, UniRush, Univision, Urban Trust, U.S. Bank, Visa, Walmart, Wells Fargo, and Western Union.
This 41-page Impact Report contains 20 figures. Clients of Aite Group's Retail Banking service can download the report.