The Secret World of Prepaid Debit card Marketing

When you think about the prepaid debit card market a lot of great things come to mind right off the bat. Many people love the idea of being able to buy the card at most stores, then adding money to it like a gift card so they can use it to buy things online without risking their identity. Others love the idea of prepaid cards because they allow people to give money as a gift without handing people cash. It’s psychologically more impressive to get a credit card than cash, but still feels like a gift, not a payoff. Kids love them because it makes them feel “grown up”.

The most interesting thing about the prepaid card to me is the evolution of this industry. The prepaid card started at banks around Christmas time several years ago as a way to resolve the “bad gift” concept and to give the gift of “choice”, to allow people to give a gift but allowing the recipient to go shop for their own gift, hence the perfect gift every time.

This became a great thing for office parties and gift exchanges because you may not really know the person your buying for so you can take the 25.00 limit and just get a gift card, problem solved! People with a lot of people on their shopping list could save time by getting several prepaid visa cards as well!

The banks didn’t anticipate this concept becoming the phenomenal market it is today, and in fact it wasn’t the banks that “banked” on the most profitable part of this idea- marketing – it was the startups.

Several companies started offering these prepaid debit cards to help rebuild your credit while shopping safely. Money on the card was insured and secure from fraud so it became safer than carrying cash. As the market grew stores started to follow suit, offering their own versions of branded prepaid cards.

Some are in store only cards (gift cards with no debit feature and only work in that particular store) while others are prepaid debit cards with the express idea of giving that store free advertizing because their brand adorns the card and every time you pull it out to spend money you put on the card, your flashing their brand advertisement!

To entice you to use their card they often add features like giving you 20% off at their store, or cash back on your purchases. Some even network with several stores to offer you discounts if you use the prepaid debit card in the stores listed on the back. Although you could use the card anywhere Visa or MasterCard are accepted, you save money if you use it at those stores. This is a nice way to get you to go to their store due to a perpetual and universal 20% off “sale” based on the percentage off on anything you buy there.