Consumers Tired of Fees are Choosing Prepaid Cards over Bank Accounts

CreditCardMenu.com has released a study on the growth of the prepaid card market and explores what is driving the demand.

  • Share on TwitterShare on FacebookShare on Google+Share on LinkedInEmail a friend

New York, NY (PRWEB) April 18, 2013

The 2013 Report on Prepaid Cards from CreditCardMenu.com finds that some of the more recent offerings may be a better choice than a traditional checking account for many consumers. The cards look like a credit card and act like a bank account, and have been popular with the underbanked population for years. But their appeal has grown and the fees have dropped. They are the fastest-growing method of payment, according to the Federal Reserve.

The study, “Are Credit Cards Replacing Checking Accounts?" looks at the growth of prepaid cards as an alternative to a traditional banking account for consumers who are tired of bank fees. It’s also a better option for people who may overspend with a line of credit granted on a traditional credit card.

The prepaid cards are also great for teenagers, and many card issuers are marketing to that generation. Prepaid card issuers are targeting a younger clientele to groom them as future life-long prepaid card users, who may one day ask “What is a checking account?”

Some of the more recent offerings include cards that feature online gaming sponsors and cartoon characters from Angry Birds to Tweety Bird. Choosing the right card is important though. The study features a chart of some of the fee-free cards that have been released in the past year.

By the Numbers:

        •    20% of the population do not have bank accounts
     •    Prepaid card volume is projected to rise 37% to $139 million by 2017

The study explores how prepaid cards have evolved and where the market is going. "Now that Walmart has partnered with American Express, and Rush has partnered with Green Dot, you can expect to see increased marketing of these cards at the retail level,” according to Rosemarie Clancy, editor-in-chief of CreditCardMenu.com.

CreditCardMenu.com is a credit card comparison website that was founded in 1996. It offers a full selection of credit cards including features, rates and advantages of each card. The website includes links to application forms of every major credit card.


Contact