Prepaid Card Users More Likely to Adopt Mobile Payments
A new study shows prepaid card users are more likely to adopt mobile payments in America. The study from Packaged Facts, “Prepaid and Gift Cards in the U.S., 4th Edition,” indicates a growing need for developers to enhance their mobile platforms for the prepaid card industry.
“Thanks to the evolution of online and mobile technology, it’s apparent that card loyalty is not garnered from the card itself, but from the features that increasingly surround it, meaning the widening ecosystem through which the cardholder can engage easily with financial services products, services and educational tools,” said David Sprinkle, research director for Packaged Facts.
Surprisingly, smartphone penetration is actually higher for unbanked and underbanked individuals than for consumers with bank accounts, which should lead prepaid card marketers to adopt more mobile technology for their cards. Nearly 89% of consumers from underbanked households use a smartphone, and 64% of consumers from unbanked households have one.
The study also shows adults between the ages of 18 and 34 do more card shopping than older adults, and they are more likely to have a wide variety of cards in their wallet. Prepaid cardholders in this young age range carry an average of 2.3 prepaid cards in their wallets.
Direct deposit is a key factor in cardholder retention, but that is not enough for the young group of cardholders. Card issuers offering mobile platforms with options such as bill pay and P2P are more likely to create longer-lasting partnerships with people age 18-34.