Travel companies eye business expansion in prepaid card segment

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Prepaid card segment has shown steady growth in current times with various industries taking an interest of business expansion towards this financial service. Global market for prepaid cards is expected to reach USD 3.1 trillion by 2022 which is driven by large section of unbanked consumers across every market, innovative service features, increased adoption of online transactions and convenient e-payment solutions. Asia Pacific region is one of the fastest growing markets in this segment at a CAGR of 16.1%. Owing to this development, transport companies have taken initiative of venturing into prepaid card segment.

Travel prepaid cards are gaining momentum in emerging markets as Chinese, Indian and Philippines travellers show increased shopping trend while travelling. PayNXT360’s global consumer survey reveals a significant jump in spending done by shoppers from these growth markets. This opens-up a new prospect for prepaid card and retailer segment in terms of customer base and revenue generation that is expected to flourish in coming years. There are countries such as Australia, Thailand and Singapore who have designed regulatory framework that supports this trend which help markets to gain access to this segment in terms of services and customer base.

Money exchange platform Travelex launched a travel based Supercard in partnership with MasterCard.  This when linked with any debit or credit card, the purchases made through it are directly charged to the respective bank account. Additionally it also allows reward point earning linked to main card through purchases that attracts customers. The service was launched earlier this year in UK. Travel based financial services are gaining interest in developed countries which are slowly making their way into emerging markets as well. Prepaid travel cards are sure to become popular in this context across markets due to convenience and benefits.

Cashless travel experience is expected to attract consumers towards travel services which would aid in positive brand association and revenue generation in coming years. Alternatively, opportunity for revenue generation opens up for prepaid card providers in travel segment.

To know more and gain deeper understanding of how prepaid card industry is shaping up globally, click here.