The prepaid functionality of the cards is designed to ultimately avoid the risk of accumulating a large amount of debt. The cards work just like credit and debit cards, except with preloaded funds, and simultaneously provide the customer with a securer alternative to cash.
MasterCard-sponsored research indicates that the majority of customers prefer more flexible gift cards that can be used at a wider range of retailers, as well as indicating a preference to deal with traveler’s checks for the safety factor. The new prepaid cards offer both flexibility and safety, MasterCard says, and are increasingly displacing gift vouchers, traveler’s checks and foreign currency sales.
Consumer demand for gift and travel cards is growing, said Chris Reddish, the head of prepaid cards for MasterCard Europe. Although consumers have become accustomed to using gift vouchers and traveler’s checks, they are now looking for solutions that are more globally accepted, convenient, and secure than cash and vouchers. These new Prepaid MasterCard Cards provide the perfect solution in each of these areas.
According to research by PSE Consulting, by 2010, the European prepaid gifting market is forecast to have a turnover of around E19 billion and the European Prepaid travel market is forecast to have a turnover of around E11 billion.
