What follows is an excerpt of an article that originally appeared on CUinsight
One study estimated that 50 percent of all U.S. financial institutions will have a prepaid option in their payments product suite in 2014. Our company alone experienced a 97-percent increase in the number of clients offering prepaid products between 2012 and 2013. That’s because credit unions and other financial institutions have recognized five distinct benefits of offering the products:
- Prepaid attracts new customers
- It’s an easy cross-sell
- Select Employee Groups and business partners also see potential in prepaid products
- Prepaid has built-in fraud protection
- The products generate much-needed revenue in three ways: retail, interchange and consumer-friendly fee income
For credit unions and community banks, prepaid products offer yet another way to help consumers achieve personal financial success. The budgeting, convenience and safety innate to the products attract more than the underbanked member (although this continues to be a powerful market from both a profit and philosophical standpoint).
Do you have thoughts on prepaid’s prospects for this year? If so, share your insight in the comments section below. More information is available in the recording of a webinar the TMG team recently put together. You can access it at themembersgroup.com/prepaid_2014.
