Tuesday, March 4, 2014
The Center for Financial Services Innovation gave the prepaid card industry an A – in its first Prepaid Industry Scorecard report. CFSI based its evaluation of the industry on how well prepaid card companies adhered to the Chicago non-profit organization's Compass principles, which are basic guidelines for prepaid products, specifically general purpose reloadable (GPR) cards, that target unbanked or underbanked consumers.
The CFSI said that the Scorecard analyzed 18 prepaid cards, which represent approximately 90 percent of the total GPR card marketplace, including card programs managed by the largest providers, as well as a sampling from smaller program managers.
The CFSI found that the GPR cards provide consumers with multiple, convenient ways to perform basic transactions and to access important account information. Additionally, fee structures for card usage are generally designed to promote positive consumer use, according to the non-profit, with program details communicated to cardholders in a straightforward and accessible manner.
Despite the high grade, the CFSI noted that there is room for improvement. "[D]eveloping supportive customer service policies and offering additional benefits such as surcharge-free ATM networks and companion cards tied to sub-accounts would make prepaid cards more valuable and versatile financial tools," the non-profit said.
GPR programs can also be improved by program managers offering budgeting tools, savings platforms and high-quality credit via GPR cards, the CFSI added.
To access the Prepaid Industry Scorecard, go to www.cfsinnovation.com/content/prepaid-industry-scorecard .
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