A new report from Aite Group, an independent research and advisory firm focused on business, technology and regulatory issues and their impact on the financial services industry, discusses the attitudes of the most frequent users of prepaid debit cards—users of alternative financial services—toward the product.
Based on a Q1 2011 Aite Group survey of 500 U.S. consumers of alternative financial services, the report reveals that nearly nine in 10 current prepaid debit cardholders are “extremely” or “very” satisfied with prepaid cards.
Aite Group expects the market for this product to grow to $104 billion in 2014. Seven in 10 current prepaid cardholders perceive prepaid debit cards to be a better deal than credit cards, and half say that prepaid cards are a better choice for them than checking accounts.
“While satisfaction rates among prepaid card users are high, former users’ views of the product aren’t as favorable,” said Ron Shevlin, senior analyst with Aite Group and author of the report. “Prepaid debit card issuers’ marketing efforts should attempt to influence prospective cardholders’ expectations about the product, especially regarding access to credit and credit-building. Long-term use should be incentivized, and alternative offerings associated with the product should be explored.”
