Creditnet News Story
Report: Prepaid cards increasing in popularity
Monday, June 28, 2010
By Thomas Astery
A greater number of Americans say they have received network-branded gift cards in the last year.
There is a greater incidence of consumers receiving a prepaid card carrying a network brand - like Visa or MasterCard - than ever before, according to Cardbeat, a market research report by Auriemma Consulting Group. In a recent survey, Cardbeat found that 42 percent of respondents said they've received these gift cards, while 67 percent got store-specific cards. Cardbeat editor Nancy Stahl said that the 2005 survey found only 26 percent of respondents got network-branded cards.
"General-purpose stored-value cards have the potential to replace traveler's and payroll deposit checks in the same way that gift cards replaced paper gift certificates, but fewer than 10 percent of our consumers have used a prepaid travel or payroll card," said Stahl.
The report also found that many parents have taken to giving teens and young adults reloadable network-branded cards. They are currently little-used, but parents surveyed were either enthusiastic about them or willing to consider them.
Cards such as these can not only help educate teens about how to develop good spending and budgeting habits, but will also keep them from getting themselves deep into credit card debt.
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