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BF_171952
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Pages: 172
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Mar 2017 | 10998 Views
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Author(s) :
Yogiata, Jeshin & Himal
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Tables: 45
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Charts: 72
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Formats*: |
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Prepaid Card Market Overview:
The prepaid card market is projected to grow at a CAGR of 22.7% from 2016 to 2022. The market accounted for $896 billion, and is expected to reach $3,653 billion by 2022. The base year considered for the study is 2015, and the forecast period is 2016‐2022.
Prepaid card is a payment card where funds are connected directly to a card without being linked to a bank account. Prepaid cards are available to everyone, regardless of credit rating, income, or whether someone holds a bank account. These cards are a substitute to a traditional bank accounts, and are a new way of managing money. These cards are widely used in retailer stores, e-commerce, and others. These were primarily introduced to cater to the unbanked population and individuals with limited access to bank services.
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The global prepaid cards market is driven by factors such as increase in awareness and ease-of-access, large number of Internet users, boom in E-commerce industry, and growth in demand for cash alternatives. These factors have increased their adoption in in corporate institutions, government, financial Institutions, & others. Therefore, the global prepaid card market is expected to witness moderate growth in the near future, owing to easy accessibility and flexibility. However, lack of security hampers the Prepaid Card Market Growth. Furthermore, emergence of new applications and growth of unbanked and underbanked population are expected to provide lucrative prepaid card market opportunity.
Segment Overview
The global prepaid card market is segmented on the basis of card type, usage, industry vertical, and geography. Based on the card type, the market is classified into single-purpose prepaid card and multi-purpose prepaid card. In 2015, the single-purpose prepaid card segment dominated the global market in terms of revenue, and is expected to maintain this trend throughout the forecast period, owing to its easy accessibility and flexibility.
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Based on usage, the general purpose reloadable card segment dominated the global market in terms of revenue, and is expected to maintain this trend throughout the forecast period. However, the gift card segment is expected to witness significant growth in the years to come owing to increase in demand for electronic payment.
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Based on prepaid card industry vertical, the retail establishment segment offers lucrative scope to prepaid card industry players, and are expected to exhibit significant growth as compared to the other segments. The prepaid card market analysis was done based on four regions, namely North America, Europe, Asia-Pacific, and LAMEA. Europe accounted for the largest revenue share in the global market, owing to the increase in demand for cash alternatives and rise in the number of unbanked and underbanked population. Conventionally, Asia-Pacific has been a region dominated by the use of cash. In recent years, the upsurge in the use of prepaid cards and subsequent transactions have led to the advancement of the payments ecosystem. This region consists of five major stakeholders in the payments ecosystem: issuing banks, cardholders, merchants, acquiring banks, and card schemes. In Asia-Pacific, economies of scale have improved as a result of growth in credit card usage across a region, which was previously dominated by use of debit cards and cash. Moreover, the number of people connected to the Internet has increased exponentially, thus increasing online transactions, which further creates ample opportunities for the prepaid card market. Prepaid card payments network is continuously impacted by commercial, technological, and regulatory factors. In November, 2016 AirPay (Thailand) partnered with MasterCard and Thanachart Bank to launch AirPay Card, a virtual prepaid card to encourage the growth of e-payments in Thailand by increasing the convenience and security of online transactions.
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Competition Analysis
Comprehensive competitive analyses and profiles of major market players, including American Express Company, Visa Inc. Mastercard Incorporated, PayPal Holdings, Inc., Kaiku Finance, LLC., The Western Union Company, Green Dot Corporation, NetSpend Holding Inc., JP Morgan Chase & Co., and AccountNow Inc. are provided in this report. Presently, the players in the global prepaid card market have adopted product launch and acquisition to expand their customer base and increase their prepaid card market shares.
Increase in awareness and ease of access
The global prepaid card market is expected to grow in the future due to increase in awareness and convenience of their usage as these cards are not linked to the bank accounts of the individuals; hence, there are no overdraft charges to the banks. Moreover, while using prepaid cards, consumers cannot borrow the money and they are limited to use only the amount that is loaded into their cards.
Growth of unbanked and underbanked population
Prepaid cards offer a safe, inexpensive, and essential banking substitute to low-income unbanked and underbanked households. According to a recent study, over 40% of prepaid card holders do not possess a checking account. Unable to access online banking, ATMs, and online shopping, these people thus use prepaid cards for strong involvement in the market. The population of these unbanked and underbanked people is increasing rapidly, thus providing a customer base for prepaid card market in the future.
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Key Benefits Prepaid Card Market:
The study provides an in-depth analysis of the global prepaid card market size and forecast to elucidate the prominent investment pockets.
Current prepaid card market trends and future estimations have been outlined to determine the overall attractiveness, and single out profitable trends to gain a stronger foothold in the market.
The report provides information regarding key drivers, restraints, and opportunities along with their impact analyses on Prepaid Card Market Forecast.
The market is analyzed based on various regions, namely North America, Europe, Asia-Pacific, and LAMEA.
Prepaid Card Market Segmentation:
By Card Type
Single-purpose Prepaid Card
Multi-purpose Prepaid Card
By Usage
General-Purpose Reloadable Card
Gift Card
Government Benefits/Disbursement Card
Incentive/Payroll Card
Others
By Industry Vertical
Retail Establishments
Corporate Institutions
Government
Financial Institutions & Others
By Geography
North America
U.S.
Mexico
Canada
Europe
UK
Germany
France
Rest of Europe
Asia-Pacific
India
China
Japan
South Korea
Rest of Asia-Pacific
LAMEA
Latin America
Middle East
Africa
The global prepaid card market has been gaining prominence in the recent years, owing to increase in awareness and convenience of their usage as these cards are not linked to the bank accounts of individuals. This eliminates the need for overdraft charges paid to banks by individuals. However, prepaid cards users cannot borrow the money, rather can only use the amount that is loaded into their cards. The acceptance of these cards was higher in developing economies than the developed countries.
Single-purpose prepaid card spending gained impetus in 2015, which in turn increased the adoption of prepaid cards in industry verticals such as retail establishment, corporate institutions, government, and others. In addition, developments in electronic payment and smart cards have propelled the market growth. For instance, in 2016, American Express launched Amex for Developers, a new portal providing a single point of access to company APIs and developer resources in categories such as payment services, customized experiences, data intelligence, and fraud prevention.
Market players have focused on developing innovative strategies for the adoption of prepaid cards in corporate institutions and government for ease of accessibility. Prepaid cards were introduced to aim at cater to the unbanked population who have limited access to bank accounts. However, the demand for these cards has increased in the recent years among traditional banking users, owing to increase in awareness and ease of access.
Rapid expansion of the e-commerce industry has compelled customers to use plastic money rather than cash. As stated by several banks, the new-age segment is one of the key factors driving sales transaction through credit, debit, and prepaid cards, globally. However, these advanced payment methods are prone to hacking, as these cards do not have security measures to prevent payment frauds. North America is the major revenue contributor in the global market, followed by Europe. The prepaid card markets in Asia-Pacific and LAMEA regions are expected to grow significantly during the forecast period.
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