Prepaid Debit Card Making a Big Impact

The researchers from Javelin Strategy and Research were commissioned in October 2011 to interview over three thousand Americans regarding the change in the usage of prepaid debit cards over the last few years. During the interview process, the team that was commissioned for this purpose learned in detail about the usage of prepaid debit cards from an overwhelming number of consumers. The findings of this research were revealed by the director of payment research at Javelin, Beth Robertson.

Over half of the respondents told the research team from Javelin that they mainly used their prepaid debit cards for purchasing various products on the internet. The reloadable prepaid debit cards issued by financial majors such as Visa, American Express and MasterCard allow Americans to covert that cash in the card into online currency and prevents that traditional bank accounts from falling prey to online fraud.

Robertson said that the usage of prepaid debit cards for online purchases accounted for only 6 percent of the overall usage. She went on to say that banks as well as retailers still need to harness the true potential of this growing market.

The prepaid debit card issuers, however, are leaving no stone unturned to turn the concept of reloadable cards into customer loyalty. Robertson said that American consumers are increasingly in favor of the prepaid cards as compared to the regular ‘one-time-use’ traditional debit cards.

As per the findings of the Javelin research, Robertson has revealed that a larger segment of the growing population in the country comprises of people who are not interested in traditional banking techniques. These people prefer other means of managing the money they have rather than opting for traditional savings and checking account.

The increase in the prepaid debit card usage has also been during to its increasing popularity among consumers who are still facing the impact of the slow economy and have been forced into finding alternatives to pay off their bills and outstanding dues.