Prepaid Debit Card Realities: Cardholder Demographics and Revenue Models
Report Summary
Prepaid Debit Card Realities: Cardholder Demographics and Revenue Models
In prepaid debit cards, heightened competition and downward pricing mean challenging revenue opportunities despite increased consumer demand.
Boston, November 26, 2013 – The prepaid debit market is showing signs of maturity—big market players dominate sales, and cardholder fees are plummeting in the face of competition. Although increasing consumer demand for prepaid debit has rendered it a mass market, new entrants are causing price compression, leading to a smaller revenue opportunity per account. With revenue streams under the microscope and regulatory requirements including interchange rates impacting business viability, market players must accumulate volume and scale just to survive. But which customers use prepaid cards, how can financial institutions win them, and what's the outlook for prepaid card revenue?
Based on a Q2 Aite Group survey of 1,242 U.S. consumers, this report on cardholder demographics and trends defines customer segments likely to use prepaid cards, provides revenue models by acquisition channel, and explains what these projections mean for the industry.
This 29-page Impact Note contains 19 figures and seven tables. Clients of Aite Group's Retail Banking service can download this report.