Prepaid debit cards are boundless in the U.S. and they abide to abound in popularity. Prepaid cards accommodate allowance cards issued by retailers or acquittal networks, as able-bodied as accepted purpose reloadable (GPR) cards such as the American Express Bluebird card, and acquittal cards disbursed by federal, accompaniment and bounded governments for abetment programs.
A 2014 survey by Mercator Advisory Group begin that 56 percent of U.S. adults had bought some affectionate of prepaid agenda in the antecedent year, up from 53 percent in 2013 and 47 percent in 2012.1
The cardinal of payments fabricated with prepaid cards rose 18.5 percent per year amid 2006 and 2012 — the fastest advance bulk of all types of payments in that timeframe.2
Gift cards still accepted with givers and receivers
Gift cards acquire become a boilerplate banking instrument, and are amid the top allowance choices for both givers and receivers. Aback asked in April 2015, about bisected of all consumers said they had acclimated a allowance agenda in the antecedent year.3
Some 87 percent of consumers say merchant-specific allowance cards are accessible to use.3 That’s apparently amid the affidavit allowance cards were the best requested anniversary allowance annual in 2015 for the ninth year in a row, according to the National Retail Federation’s Anniversary Consumer Spending Survey. Approximately 58.8 percent of consumers said they would like to acquire a allowance agenda during the anniversary season.4
FACTOID:Sixty-five percent of allowance agenda recipients absorb an boilerplate of 38 percent added than the face bulk of their cards.10
Many of those absent allowance cards are acceptable to get their wish. Approximately 73.4 percent of American adults planned to buy at atomic one allowance agenda during the 2015 anniversary arcade season, according to the NRF’s survey, which was conducted in October 2015. Women were added acceptable to buy them than men, with 76.2 percent of women planning to buy allowance cards during the 2015 anniversary season, compared to 70.4 percent of men.5
When respondents who planned to buy allowance cards were asked how abounding cards they would buy, the best accepted cardinal was two.5
Total spending on allowance cards during the 2015 anniversary arcade division is accepted to be $25.9 billion. But boilerplate spending is accepted to dip to $153.08, bottomward from $172.74 in 2014.4
Men are predicted to be the added acceptable gender, spending on boilerplate $162.01, compared to women, who adumbrate they’ll absorb an boilerplate of $144.62 on allowance cards. Adults over 65 may be the better allowance agenda spenders of all age groups, averaging $186.44.4
Breaking that bottomward by card, shoppers are accepted to absorb an boilerplate of $44.83 per agenda during the 2015 anniversary arcade period, bottomward from $47.87 in 2014.5
Gift cards abatement into two above categories. Accessible bend cards are those issued by Visa, MasterCard, American Express or Discover, which can be acclimated at any merchant that accepts acclaim cards that are allotment of those networks. Bankrupt bend cards are those issued by a accurate banker and can alone be acclimated by the arising merchant.
When allowance agenda buyers were asked what blazon of allowance cards they advised to buy during the 2015 anniversary arcade season, the best accepted choices were bankrupt bend cards from restaurants (34.8 percent) and administration food (34.4 percent), followed by accessible bend cards (22.7 percent) and coffee boutique cards (20.1 percent). 5
Why do Americans buy allowance cards during the anniversary season? Approximately 50.4 percent said allowance cards acquiesce recipients to baddest their own gifts. That was followed by 24.7 percent who said allowance cards were easier and faster to buy than acceptable gifts. Alone 5.2 percent said affairs allowance cards helped them stick to their anniversary budget.5
Digital accepted to advance way in slowing market
The all-embracing bazaar for allowance cards continues to grow, but as the industry matures, its bulk of advance is slowing from double-digit ante in beforehand years.
As of December 2014, allowance agenda sales for 2014 were predicted to ability $124 billion, bristles percent college than in 2013. The bazaar is accepted to abide growing 5-6 percent per year through 2017.6
Open bend cards are growing hardly faster than bankrupt loop. Sales of accessible bend cards rose from $43 billion in 2013 to $45 billion in 2014 (4.7 percent). Sales of bankrupt bend cards grew from $70 billion in 2013 to $73 billion in 2014 (4.3 percent).6
E-gifting, or the sending of agenda allowance cards, is acrimonious up momentup as artificial agenda advance levels off. E-gifting grew 20 percent, from $5 billion in 2013 to $6 billion in 2014. In fact, e-gifting is accepted to hit $14 billion by 2017, absolute about 10 percent of the allowance agenda market.6
When consumers are arcade online, they added acquire to buy agenda allowance cards rather than concrete allowance cards. In December 2014, agenda allowance cards accounted for 67 percent of etailers’ allowance agenda sales while concrete allowance cards accounted for 33 percent.7
Some 72 percent of consumers said they had purchased a allowance agenda online or via the adaptable channel. Fifty percent said they would adopt to acquire a agenda allowance agenda scanned from their buzz than backpack an email printout. Also, 53 percent said they would be absorbed in autumn allowance cards on their phones.7
Spillage is the bulk of money larboard unspent as a aftereffect of bare or asleep cards. In 2014, spillage was projected to abatement beneath $1 billion, accounting for beneath than 1 percent of absolute allowance agenda volume. That’s bottomward from 2006 aback spillage accounted for about 10 percent of allowance agenda volume, acknowledgment in allotment to accoutrement of the CARD Act of 2009, which forbids allowance cards from expiring for bristles years.6
There are a cardinal of means that you can abstain spillage. In 11 states, shoppers who acquire bankrupt bend allowance cards can address that the agenda antithesis be accustomed to them in banknote aback already they’ve spent bottomward to a assertive threshold.
General purpose reloadable cards: the blockage annual alternative
GPR prepaid cards ample a altered bazaar charge from allowance cards. They are about acclimated to pay bills, admission banknote and accomplish purchases, and can be acclimated in abode of a acclaim or debit card, or alike a acceptable coffer account.
More and added Americans are application them. In August 2013, 25 percent of Americans endemic a GPR prepaid card, up from 21 percent the year before.8
Some $65 billion was loaded assimilate GPR prepaid cards in 2012 — added than alert the bulk loaded in 2009. 9 That, admitting the actuality that abounding prepaid agenda affairs are for small-dollar purchases.
FACTOID:In 2012, 20 percent of accepted purpose prepaid agenda affairs were for beneath than $5.2
According to 2012 abstracts from The Pew Charitable Trusts, prepaid agenda users are added acceptable than the accepted citizenry to:
FACTOID:Forty-two percent of prepaid agenda users in 2012 had no emergency savings, compared to 28 percent of the accepted population.9
GPR cards were at one time abundantly targeted at low-income and underbanked consumers. In fact, 48 percent of the underbanked association appear owning a GPR agenda in 2013.8
However, the greatest advance in agenda buying has been amid college assets Americans. Amid August 2012 and August 2013, buying of a GPR agenda in households that fabricated added than $100,000 per year added by 9 percent, while buying of a GPR agenda in households earning amid $25,000 and $49,900 alone 1 percent.8
In 2013, the boilerplate assets of Americans with GPR prepaid cards was $63,217, up from $55,347 in 2012. Americans with college incomes spent the best money on their reloadable prepaid cards. Households with GPR prepaid cards and incomes of $100,000 or college had an boilerplate reload bulk of $98, compared to $85, $78, and $60 reload ethics for households authoritative $50,000 to $99,900 per year, $25,000 to $49,9000 per year and beneath than $25,000 per year respectively.8
While GPR use has risen amid all age groups, adolescent groups acquire apparent the best growth. There was an 11 percent admission in buying of GPR cards amid millennials amid August 2012 and August 2013. Amid Generation Xers GPR agenda buying added by 8 percent. Buying by babyish boomers added by 2 percent and consumers 68 and over saw their GPR agenda buying break the aforementioned at 4 percent.8
The address of prepaids
The best accepted affidavit bodies cited in 2012 for application prepaid cards were to accomplish purchases in places that don’t acquire cash, to abstain acclaim agenda debt, to ascendancy spending and to abstain defalcation fees.9
Although 33 percent of prepaid agenda users in 2012 said they incurred beneath defalcation fees,9 there are additionally fees associated with prepaid cards. In 2013, 68 percent of GPR prepaid agenda users paid some blazon of fee, with the boilerplate account fee absolute at $5.80.8
Twelve actor adults — 5 percent — acclimated a GPR prepaid agenda at atomic already per ages in 2012.9 One in bristles prepaid agenda holders acclimated two or added prepaid cards per month; amid the reasons: a admiration to ascendancy spending on altered items or accord altered bodies in a domiciliary admission to money.9
Higher-earning millennials are best acceptable to be prepaid agenda “power users.” Millennial GPR prepaid agenda users earning $50,000 to $99,900 per year averaged 10.1 uses per month, compared to an boilerplate of 6.2 uses amid all GPR prepaid agenda owners who had acclimated a agenda that month. 8
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See related: Acclaim agenda statistics, industry facts, debt statistics, Debit agenda statistics, Acclaim agenda bazaar allotment statistics
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