With the significant increase in online transactions and the demand for cost-effective electronic payment solutions, the prepaid debit card has become increasingly popular amongst consumers and businesses alike. The global market projection for prepaid card spending is estimated to reach US$3.1 trillion dollars by 2022.
In fact, the United States has the highest use of prepaid cards worldwide and the growth has skyrocketed over the past decade. In 2003, 800 million transactions were processed using a prepaid debit card, amounting to $20 billion in spending. By 2012, the number had increased to 9.2 billion transactions totaling $220 billion and a recent report from BI Intelligence has estimated that this year will reach a new record of $317 billion in purchase volume.
The trend in using a prepaid debit card versus a traditional credit card is also taking off within the corporate sector. In a report released by the Federal Reserve Bank of Philadelphia in 2012, highlighted that businesses of all sizes and governments as well were increasingly viewing using a prepaid system as a less expensive alternative than processing payroll or reimbursement checks.
There are numerous reasons why the prepaid method is attractive to businesses:
● Continued rise in online purchasing and bill payments
● Increased retailer acceptance
● Safer than using checks or cash
● International and POS acceptance
● Easier management of spending tracking
● Reduction of overdraft and interest charges
● Enforcement of spending policies
● Lower administrative costs
It is expected to continue to see the trend of rising prepaid use expand within the corporate world and replace many traditional spending methods such as petty cash and shared company credit cards. As more organizations are seeking ways to trim administrative overhead costs wherever possible, the prepaid debit card offers a convenient and cost-effective alternative.
If your business has considered using prepaid cards, Emburse can help. Our system makes it simple to assign and activate cards, manage budgets and employee spending. With our real-time online management system, controlling and monitoring purchases is easy to manage and always accessible.
To schedule a demo to learn more about Emburse solutions, contact us today.