Product Code: LA16121077
The COVID-19 pandemic is reshaping the prepaid card industry. As store closures hobble the mighty J-hook, and related trends push prepaid card users into the digital realm, these cash-loyal consumers find themselves choosing their card over cash and coins. And while short-term payment value pain hits most segments of the prepaid card market, long-term interchange fee revenue gains are in the making. Of course, card type and other growth factors helps shape the longer-term outcome: B2B prepaid cards, for example, continue their growth tear, while the proliferation of app-based prepaid digital accounts pressures consumer general-purpose reloadable prepaid card growth. Overall, Packaged Facts expects the prepaid card market to grow by a healthy 6% average annual rate from 2020 to 2024.
‘Prepaid Cards in the U.S., 7th Edition’, provides insight into significant near-term and longer-term factors shaping this varied and growing card segment.
More specifically, this report:
- provides a market size and forecast for the prepaid card market, including trended payment value for general use (open-loop) and private label (closed-loop) prepaid cards, by card type, with related growth opportunity analysis
- assesses in detail the effects of the COVID-19 pandemic on the prepaid card industry, including cash conversion, payment electronification, interchange, and deposits, as well as effects by card type
- gauges (reloadable and non-reloadable) prepaid card use trends during 2014-2019, breaking prepaid card use down by card network; banked status; credit score; cash preference; and app and smartphone use
- identifies top general-purpose prepaid card brand and card network brands, by demographic
- studies reasons for choosing general-purpose reloadable prepaid cards, including use cost; overdraft fee avoidance and debt management; credit and bank account substitution; breadth of acceptance; and reloading method
- explores prepaid card marketer and issuer strategies, including those of Axos Financial, The Bancorp Bank, Green Dot, MetaBank and Netspend
- Analysis includes competitive positioning, new product introductions, company innovations, and trended performance analysis.
- Heavy emphasis is placed on add-value proprietary estimates for load value, purchase value, and other metrics otherwise not published by these industry participants.
- Thorough analysis of the app-based digital banking threat is also included.
- explores a variety of prepaid card industry challenges and solutions, including regulatory issues, pricing, and profit factors, broadening the target audience, bank account competition, and fraud
VIDEO DEMONSTRATION
TABLE OF CONTENTS
CHAPTER 1: EXECUTIVE SUMMARY
- Growth Opportunity
- Coronavirus Pandemic Impact on the Prepaid Card Industry
- App-Based Digital Banking Threatens GPR Prepaid Industry
- Prepaid Card Use Trends
- General-Purpose Prepaid Card Use Trends: 2014-2019
- General-Purpose Reloadable Prepaid Card Use: 2014-2019
- General-Purpose Non-Reloadable Prepaid Card Use: 2014-2019
- Bank Account, Smartphone, and Banking App Use Analysis
- General-Purpose Prepaid Card Brand and Card Network Brand Use
- General-Purpose Reloadable Prepaid Card Feature and Use Rationales
- General-Purpose Reloadable Prepaid Card Features Used
- Money Movement and Payment Features: Demographic Analysis
- Financial Management Features: Demographic Analysis
- Reasons for Choosing Reloadable Prepaid Cards
- Prepaid Card Marketer and Issuer Strategies
- Axos Financial
- The Bancorp, Inc.
- Green Dot Corporation
- MetaBank
- Netspend
CHAPTER 2: MARKET SIZE AND FORECAST
- U.S. PREPAID CARD MARKET SIZE AND FORECAST
- Payment Value to Reach $377 Billion in 2020
- Table 2-1 U.S. Prepaid Card Market Size, 2016-2020
- 2024 Payment Value Forecasted at $475.3 billion
- Table 2-2 U.S. Prepaid Card Market Size, 2016-2020
- "Open-Loop" Prepaid Card Market Size, by Card Type
- Table 2-3 U.S. Open-Loop Prepaid Card Market Size: By Type, 2016-2020
- "Closed-Loop" Prepaid Card Market Size, by Card Type
- Table 2-4 U.S. Closed-Loop Prepaid Card Market Size: By Type, 2016-2020
- Sideways/Down: Consumer General-Purpose Reloadable Prepaid Cards
- Near-Term Declines; Long-Term Incremental Growth: Gift Cards
- Strong Near-Term/Incremental Long-Term Growth: Government Prepaid Cards
- Moderate-to-Strong Growth: Healthcare Cards
- Near-Term Declines; Moderate-to-Strong Growth: Payroll Cards
- Strong Growth: B2B Payments
CHAPTER 3: CHALLENGES AND OPPORTUNITIES
- CORONAVIRUS PANDEMIC IMPACT ON THE PREPAID CARD INDUSTRY
- General-Purpose Prepaid Card Spend to Take Discretionary & Non-Discretionary Hit
- Near- and Long-Term: Prepaid Cardholder Cash Preferences to Give Way
- Data suggests prepaid card users still maintain stronger cash preferences
- Table 3-1 Attitudes Toward Cash as Preferred Purchase Payment Method and Always Using Cash to Pay Bills, 2019 (general-purpose reloadable prepaid card vs. debit card vs. credit card users)
- Table 3-2 Attitudes Toward Cash as Preferred Purchase Payment Method and Always Using Cash to Pay Bills: General-Purpose Reloadable Prepaid Card Users by HH Income Bracket, 2019
- Near- and Long-Term: In-Store Purchases Pressured and Online Purchases Benefit
- Near- and Long-Term: The J-Hook Takes a Gut Punch
- Near- and Long-Term: Interchange Wins
- Near-Term: Stimulus Bump
- Near-Term Winner: Government Benefits Programs
- Near-Term Loser: Payroll Cards
- Near-Term Loser: Tax Refund Cards
- APP-BASED DIGITAL BANKING THREATENS GPR PREPAID INDUSTRY
- The Good: Prepaid Cards Adapt to Digital Banking World
- The Spoiler? Fintech Marketers Undercut on Price and Deliver on Features
- In Focus: Chime
- Potentially and Realistically Free to Use
- Table 3-3 Chime Account Fees, 2020
- Savings Innovation
- The Big Picture
CHAPTER 4: PREPAID CARD USE TRENDS
- GENERAL-PURPOSE PREPAID CARD USE TRENDS: 2014-2019
- Reloadable and Non-Reloadable Card Use Declines
- Table 4-1 General-Purpose Prepaid Card Use, 2014-2019 (reloadable vs. non-reloadable)
- Lower-Income Adults Remain a Sweet Spot
- Table 4-2 General-Purpose Prepaid Card Use: By Age Bracket and HH Income Bracket, 2014-2019
- Visa Leads Use but Mastercard Is Gaining Share
- Table 4-3 General-Purpose Prepaid Card Use Share by Card Network, 2014-2019
- GENERAL-PURPOSE RELOADABLE PREPAID CARD USE: 2014-2019
- 18- to 34-Year-Olds as a Trouble Spot
- Table 4-4 General-Purpose Reloadable Prepaid Card Use Share by Age Bracket and HH Income Bracket, 2014-2019
- Declines Are an Industry Trend, not a Network-Specific One
- Table 4-5 General-Purpose Reloadable Prepaid Card Use by Card Network, 2014-2019
- GENERAL-PURPOSE NON-RELOADABLE PREPAID CARD USE: 2014-2019
- Middle-Income Traction
- Table 4-6 General-Purpose Non-Reloadable Prepaid Card Use: By Age Bracket and HH Income Bracket, 2014-2019
- Table 4-7 General-Purpose Non-Reloadable Prepaid Card Use by Card Network, 2014-2019
- Bank Account, Smartphone, and Banking App Use Analysis
- Table 4-8 Bank Account, Smartphone, and Banking App Use: General-Purpose Reloadable Prepaid Card, Debit Card, and Credit Card Users (2014 vs. 2019)
- GENERAL-PURPOSE PREPAID CARD BRAND AND CARD NETWORK BRAND USE
- Overview
- Table 4-9 General-Purpose Prepaid Card Use by Card Brand/Network, 2018
- Demographic Analysis
- Table 4-10 General-Purpose Prepaid Card Use by Card Brand/Network: By Age Bracket, 2018
- Table 4-11 General-Purpose Prepaid Card Use: By HH Income Bracket and Card Brand/Network, 2018
- Table 4-12 General-Purpose Prepaid Card Use by Card Brand/Network: By Credit Score, 2018
- Table 4-13 General-Purpose Prepaid Card Use: by Banked Status and Card Brand/Network, 2018
CHAPTER 5: GENERAL-PURPOSE RELOADABLE PREPAID CARD FEATURE AND USE RATIONALES
- GENERAL-PURPOSE RELOADABLE PREPAID CARD FEATURES USED
- Table 5-1 General-Purpose Reloadable Prepaid Card Features Used, 2018 vs. 2020 (percent of adults)
- Money Movement and Payment Features: Demographic Analysis
- Table 5-2 General-Purpose Reloadable Prepaid Card Money Movement and Payment Features Used: By Age, 2020
- Table 5-3 General-Purpose Reloadable Prepaid Card Money Movement and Payment Features Used: By HH Income Bracket, 2020
- Table 5-4 General-Purpose Reloadable Prepaid Card Features Money Movement and Payment
- Features Used: By HH Income Bracket, 2020 (18-34 years old vs. 35+ years old)
- Financial Management Features: Demographic Analysis
- Table 5-5 General-Purpose Reloadable Prepaid Card Financial Management Features Used: By Age Bracket, 2020
- Table 5-6 General-Purpose Reloadable Prepaid Card Financial Management Features Used: By HH Income Bracket, 2020
- Table 5-7 General-Purpose Reloadable Prepaid Card Financial Management Features Used: By HH Income Bracket, 2020 (18-34 years old vs. 35+ years old)
- REASONS FOR CHOOSING RELOADABLE PREPAID CARDS
- Acceptance and No Fees Rule the Roost
- Table 5-8 Important Reasons for Choosing a Prepaid Card, 2018 vs. 2020
- Influence of Direct Deposit on Card Use
- Table 5-9 Prepaid Card Reload, Monthly Fee, Withdrawal, and Purchase Behavior, 2018 vs. 2020
- Table 5-10 Prepaid Card Reload, Monthly Fee, Withdrawal, and Purchase Behavior: Direct Deposit vs No Direct Deposit, 2020
- Table 5-11 Prepaid Card Reload, Monthly Fee, Withdrawal, and Purchase Behavior: By HH Income Bracket, 2020 (18-34 years old vs. 35+ years old)
CHAPTER 6: PREPAID CARD MARKETER & ISSUER STRATEGIES
- AXOS FINANCIAL
- Prepaid Card Programs
- Table 6-1 Axos Financial: General-Purpose Reloadable Prepaid Card Program Brands, Managers, and Networks, 2020
- The Tax Man Cometh: H&R Block Prepaid Emerald Card and Related Products
- The Card Leverages Ancillary Products to Grow
- Table 6-2 H&R Block Emerald Card: Active Cards, Deposits, and Revenue, with Per-Card Metrics, 2012-2016
- H&R Block Revenue Trends Suggest Card Growth
- Table 6-3 H&R Block Revenue: Total, Refund Transfer, Emerald Card, and Emerald Advance, 2014-2019
- Deposits Trends Suggest Emerald Card Growth
- But Cardholder Engagement Remains a Struggle
- Table 6-4 Axos Financial, Inc. Prepaid Card Deposits: Q4 2015-2019 vs. Q1 2016-2020
- Refund Advance Origination Trends Suggests Room to Grow
- Table 6-5 Axos Financial, Inc. Prepaid Card Deposits: Q4 2015-2019 vs. Q1 2016-2020
- H&R Block Relationship Strongly Impacts Deposits
- Table 6-6 Axos Financial, Inc.: Number of Deposit Accounts by Type, 2013-2019
- Prepaid Card Interchange Exemption Breach
- THE BANCORP, INC.
- Regional Lender and Prepaid Card Leader
- Variety of Prepaid Card Programs, Program Managers, and Card Verticals
- Table 6-7 The Bancorp Bank: General-Purpose Reloadable Prepaid Card Program Brands, Managers, Networks, and Card Types, 2020
- But Non-Prepaid Debit Fintech Partnerships Drive Growth
- Table 6-8 The Bancorp Bank: Non-Prepaid Debit Fintech Partnerships: By Name, Network Brand, and Launch Date, 2012-2020
- And General-Purpose, Reloadable Cards Are Being Replaced
- Healthcare a Bright Spot
- Prepaid Card Deposits on the Rise
- Table 6-9 The Bancorp: Average Q4 Total and Prepaid Card Deposits, 2016-2019
- Real-Time ACH Growth
- Performance Trends
- Table 6-10 The Bancorp: Load Value and Selected Non-Interest Income Metrics, 2015-2019
- Prepaid Card Growth Trends
- GREEN DOT CORPORATION
- Table 6-11 Green Dot Consumer Product Features and Platform Capabilities, 2020
- Market Segments
- Operating Segments
- Table 6-12 Green Dot Operating Revenue by Segment, 2015-2019
- Key Program Brands
- Table 6-13 Green Dot General-Purpose Reloadable Prepaid Card Program Brands and Networks, 2020
- Table 6-14 Green Dot General-Purpose Reloadable Prepaid Card Program Management-Only Brands and Networks, 2020
- Key Relationship: Walmart
- Table 6-15 Green Dot Operating Revenue and Revenue Attributable to Walmart, 2015-2019
- The Walmart MoneyCard
- Walmart MoneyCard: Nuts and Bolts
- Savings, Budgeting, and Direct Deposit Features
- Stimulus Grab
- Key Competitive Threat: Low-Cost App-Based Digital Banking
- Key New Product: Unlimited by Green Dot
- Key Service: BaaS
- Apple Cash
- Uber
- Intuit
- Wealthfront
- Stash
- Key Performance Trends
- Parsing Prepaid from Debit Is a Trickier Proposition
- Table 6-16 Green Dot Active Cards, Cash Transfers, Load Value, Purchase Value, GPR Deposits, and
- Tax Refunds Processed, 2013-2019
- Table 6-17 Green Dot Active Cards, Cash Transfers, Load Value, Purchase Value, GPR Deposits, and
- Tax Refunds Processed: Percentage Annual Growth, 2014-2019
- Key Revenue Trends
- Table 6-18 Green Dot Operating Revenue by Type, 2015-2019
- Per-Card Revenue, Load Value, and Purchase Value Trends
- Table 6-19 Green Dot: Per-Card Prepaid Card Analysis: Revenue by Type, Load Value, and Purchase Value, 2015-2019
- COVID Crunch
- METABANK
- Card Brands and Segments
- General-Purpose Reloadable Prepaid Card Programs
- Table 6-20 MetaBank General-Purpose Reloadable Prepaid Card Program Brands, Managers, and Networks, 2020
- Payroll Expansion
- Table 6-21 MetaBank Payroll Card Program Brands, Managers, and Networks, 2020
- Tax Services Expansion
- Table 6-22 MetaBank Prepaid Card Program Brands, Managers, and Networks: By Card Type, 2020
- Table 6-23 MetaBank: Refund Transfer Fee and Tax Advance Metrics, 2016-2019
- Performance Trends
- Table 6-24 MetaBank: Meta Payment Systems Deposit Analysis, 2015-2019
- MPS Card Fee Income Stagnation and Decline
- Table 6-25 MetaBank: MPS Non-Interest Income, Card Fee, Deposit Fee, and Interchange Analysis, 2016-2019
- NETSPEND
- Overview
- Competitive Positioning
- Card Brands
- Table 6-26 Netspend Reloadable Prepaid Card Programs: Brands, Issuers, and Networks, and Card Types, 2020
- Retail Distribution
- Performance Trends
- Revenue Stagnation and Active Card Declines
- Table 6-27 Netspend: Revenue, Active Cards, and Per-Card Revenue: By Revenue Stream and Direct Deposit Use, 2014-2019
- Table 6-28 Netspend Prepaid Card Load Value, 2014-2019
- Debit Competition Affects Card Base and Masks Load Value Trends
- Table 6-29 Netspend: Active Cards and Load Value with Direct Deposit Share, 2014-2019
- Direct Deposit Remains King
- Table 6-30 Netspend: Total and Per-Card Revenue and Load Value: By Card Direct Deposit Status, 2014-2019
- COVID Crunch
APPENDIX
- METHODOLOGY
- Consumer Survey Methodology
- Population Estimates
- Prepaid Card Exemptions from Debit Card Interchange Limits
- ABBREVIATIONS
- Table Appendix-1: Report Abbreviations, 2020
- TERMS AND DEFINITIONS
- Bank account number payment
- Banked status
- Card issuer
- Card network
- Deduction from income
- Demand deposit account (DDA)
- Electronic funds transfer (EFT)
- Interchange fee
- Issuing bank
- Merchant acquirer
- Online banking bill payment
- PIN-based/single-message transactions
- Prepaid card
- Processor
- Program manager
- Signature-based/dual-message transactions