The prеpaid card industry is booming. With its prе-loading capabilities, еasе of paymеnt, and еxtraordinary rеwards and loyalty fеaturеs, it has alrеady startеd taking cеntеr stagе in many industries.
According to a study by Junipеr Rеsеarch, the global markеt for prеpaid cards was valuеd at $ 3.5 trillion in 2023 and was prеdictеd to rise to $ 6.7 trillion by 2028. This stat indicates a markеt growth of a whopping 92% in the period 2023-2028.
As morе pеoplе adopt prеpaid cards for purchasеs and paymеnts, companies offеring thеsе sеrvicеs nееd to stay ahеad of consumеr dеmand and еvеr-changing tеchnology. What doеs thе future hold for prеpaid card solutions? How will it be a plus point for thе businеss?
Rеad this blog to gеt an insight into thе top prеdictions for prеpaid card solutions in 2024 and beyond. Lеt’s bеgin!
Widespread acceptance of prepaid card solution
Prеpaid cards’ accеptancе has grown rapidly among both digital and brick-and-mortar mеrchants over the past few years. This prepaid card market trend is еxpеctеd to continuе with morе rеtailеrs еmbracing prеpaid card solutions as a convеniеnt and sеcurе paymеnt mеthod. Thеrе arе a fеw kеy drivеrs of this widеsprеad adoption:
Growing retailer adoption
An incrеasing numbеr of onlinе and in-storе rеtailеrs now accеpt major prеpaid card solutions as morе customers rеquеst this paymеnt option. Big players likе Amazon and Walmart alrеady offеr prеpaid cards, and wе еxpеct morе spеcializеd rеtailеrs to follow thе lеad by 2024 to capturе this growing markеt.
Prepaid card solutions for travel expansion
Prеpaid travеl cards arе gaining popularity intеrnationally thanks to bеttеr еxchangе ratеs and cardholdеr sеcurity compared to cash or standard crеdit cards. As morе travelers sееk thеsе bеnеfits, thеrе will bе grеatеr airlinе, hotеl, and hospitality businеss adoption of prеpaid card software by 2024.
Loyalty building with gift cards
Both digital and physical gift cards allow retailers to drive customer loyalty and engagement. Through tailored gift card incentives, promotions, and VIP services, merchants can creatively use prepaid card solutions to acquire new customers and encourage repeat business.
With such exceptional benefits, it can be predicted that significantly more retailers will explore prepaid card loyalty programs in 2024 and the coming years.
Advanced prepaid card security
With rising digital transaction volumes reaching US$9.45tn in 2023, prepaid card solution providers are prioritizing advanced security capabilities that protect cardholders against emerging payment threats while allowing convenient account access. Cutting-edge technologies will shape fraud prevention and monitoring as one of the prepaid card trends 2024.
Chip technology reduces fraud
Over 60% of cards issued in the United States will transition to EMV chip technology by 2025, which generates unique data for each transaction to prevent counterfeit fraud. Alongside encryption and tokenization, chip cards significantly reduce in-person payment fraud. Hence, prepaid card solutions are considered the most secure ones for implementing into the business!
Remote locking capability
Prepaid card solution providers will implement mobile-based card locking and unlocking features, which allow customers to secure accounts when security threats arise and instantly unfreeze them after it subsides. By giving cardholders more real-time cards, security is strengthened for prepaid card users.
Remote locking capability
Prepaid card solution providers will implement mobile-based card locking and unlocking features, which allow customers to secure accounts when security threats arise and instantly unfreeze them after it subsides. By giving cardholders more real-time cards, security is strengthened for prepaid card users.
EMV and tokenization to reduce fraud
Combined with EMV microchips, tokenization makes data stealing impossible for fraudsters and criminals even if they infiltrate merchant systems. There will be a significant boost in the EMV-chipped prepaid card solutions to offer an extra level of proven security.
Biometrics becoming more common
When it comes to virtual prepaid cards, fingerprint and facial recognition for prepaid cards in the mobile wallet are strictly implemented. Over 80% of smartphones are equipped with biometric sensors. So, prepaid card solution providers will increasingly integrate biometric authentication and verification.
Integration with mobile wallets
Mobile wallet solutions have become instrumental in the payment ecosystem. The current prepaid card market helps us to predict that prepaid card issuers will focus heavily on deep mobile wallet integrations to align with evolving consumer preferences for all-in-one money management.
Streamlining everyday spend
Top mobile wallets like Apple Pay, Google Pay, and Samsung Pay will likely start offering the linking of prepaid cards to the wallets by 2025. Customers will be able to add their prepaid credentials and set the mobile wallet as the default pay option for frictionless in-store or in-app payments.
Streamlining everyday spend
Top mobile wallets like Apple Pay, Google Pay, and Samsung Pay will likely start offering the linking of prepaid cards to the wallets by 2025. Customers will be able to add their prepaid credentials and set the mobile wallet as the default pay option for frictionless in-store or in-app payments.
Cash loading or unloading made easier
Partnerships with digital fintech solution providerwill allow seamless transfers between prepaid card accounts and mobile wallets. Customers will be able to deposit and withdraw cash from wallet balances to cards with minimal clicks for easy liquidity access.
Loyalty and discount bundling
In 2024, there is a possibility of branded mobile wallets linking their loyalty programs, offers, and discounts with prepaid cards to offer engaging incentives to the users. Costumes would only need to tap once to redeem points or coupons while making purchases with prepaid cards or mobile wallets linked to them.
Mobile wallet solutions for customer loyalty and reward program
Support from consumer shifts
Evolving user preferences and demographics will further propel prepaid card software adoption over the next few years. Prepaid card solution providers that understand these consumer shifts can develop tailored products that align with the emerging needs of small and large businesses.
Move from cash to prepaid
The consumers first shifted from cash to cards and then cards to digital payments and now to contactless payments and digital payments together. That's the reason why prepaid cards came into the picture - digital prepaid cards as well as physical ones. Consumers only want more convenience and security than their previous methods of payment.
And prepaid card software does full justice to their evolving behaviors. It offers security, convenience, and budgeting control. However, till 2022 there were still 59% of cash payments. So, in the future, we can expect that this number will further reduce with the advent of prepaid card solutions.
Unbanked segment adoption
Globally, around 1.4 billion adults are unbanked. Prepaid cards give the underbanked an affordable and accessible financial tool without credit checks. This facilitates more of them to opt for prepaid cards. So, it can be predicted that in the coming year, a large portion of the unbanked and underbanked population will actively use prepaid cards according to BusinessWire.
Millennial user growth
The majority of Millennials get attracted to these prepaid payment options because of the discounts & offers attached to them. This shows a high chance that the millennial users for digital prepaid cards will grow significantly.
Also, features like P2P transfers, mobile app controls, and real-time notifications appeal to millennial convenience and engagement preferences.
Favorable market trends
Certain developing macro conditions actively support prepaid card market growth trajectories as the prepaid card trends 2024 and beyond. Prepaid card solution providers should consider these trends when projecting market expansion.
Expanding urbanization
Urban migration escalates globally as over 70% of the world’s population will inhabit cities by 2030. Urban citizens are more tech-quipped and modern. Hence, the adoption of cashless payments and prepaid cards in urban areas is already more than the rural. And with the increasing urban population, the adoption will also increase.
Retailer-branded prepaid cards
Retail giants from Starbucks to Amazon are launching branded prepaid products allowing customers to shop within their ecosystems. These create sticky, closed-loop environments that benefit the merchant. Plus, it increases brand visibility, working capital, and active users. The growth of such prepaid cards might increase in 2024.
What other industries might see a rise in prepaid card solutions?
Healthcare
Healthcare providers will use prepaid card management software to manage patient payment cards for specific services or procedures, such as health savings account (HSA) cards or flexible spending account (FSA) cards. This can streamline billing and reduce administrative costs.
Government
Many governments already use prepaid cards to offer various services to their country's citizens. 2024 will see a rise in government agencies using prepaid card platforms to manage payment cards for various purposes, such as government benefits or employee expense cards. toll, parking, and fuel can also be managed over here.
Theme parks and attractions
There will be an extensive use of closed-loop prepaid cards at theme parks and other attractions for entry, as well as merchandise & food purchases. A prepaid card platform can provide a convenient and secure way for visitors to make purchases without carrying cash.
Moreover, teenagers, transit systems, travel & hospitality, and businesses will also leverage the prepaid card solutions for their growth and success.
How DigiPay.Guru can help stay ahead of the industry?
DigiPay.Guru offers prepaid card management software that facilitates businesses to offer prepaid cards to their customers. These prepaid card platforms are secure, efficient, NFC-enabled, and fast.
Our prepaid card solutions come with capabilities that enhance customer loyalty with loyalty programs, boost working capital, increase brand visibility, and offer multiple currency options, multiple payment options, and robust security.
We offer both, physical and virtual prepaid cards for extensive usage and convenience to the customers. The retail and hospitality industries are already leveraging the power of our solutions. Now, it's your turn!
Conclusion
Prepaid cards are the tomorrow of payments! And 2024 looks as promising and beyond as 2023. As we look ahead at the future of the prepaid card industry, the landscape is filled with tremendous growth opportunities as consumer adoption accelerates globally.
Prepaid cards are rapidly becoming a trusted, indispensable payment tool for all user segments regardless of bank account ownership or income levels.
With DigiPay.Guru’s future-ready prеpaid card solution, businesses can thrivе in thе dynamic world of paymеnts and bеcomе thе lеadеrs of thеir industry whilе kееping thеir customеrs rеtainеd and happy.
