Pre-paid card transaction value to exceed $4.1 trillion by 2026 globally, as financial inclusion drives usage

assets/files/images/12_01_22/Prepaid-Card-Transaction-1200x900.jpg

This article is brought to you by Retail Technology Review: Pre-paid card transaction value to exceed $4.1 trillion by 2026 globally, as financial inclusion drives usage.

A new study from Juniper Research has found that the value of transactions made over pre-paid cards will exceed $4.1 trillion globally in 2026; up from $2.3 trillion in 2021 – a substantial growth of 75%.

By 2026, pre-paid card transaction value will be just over 50% higher than that forecast for contactless payment transactions; illustrating the importance of this market. The growth in pre-paid cards will be driven by the ongoing replacement of cash, as economies move increasingly towards digital payments.

The research identified pre-paid cards as being critical to ensuring that the unbanked are included in the rush for digital payments. The research recommends that vendors focus on building robust distribution platforms that can cope with issuing cards at scale and at low cost, or they will lose out to better equipped vendors.

Prepaid Cards Driving Significant Fee Revenue

The new research, Pre-paid Cards: Trends, Vendor Strategies & Market Forecasts 2022-2026, found that the growth of the prepaid market will present a significant revenue opportunity for pre-paid card platforms, with fee revenue reaching over $32 billion globally in 2026, from $22 billion in 2021. The report recommends that focusing on critical capabilities, such as restricted authorisation, which enables issuers to specify where funds can be spent, will pay dividends in the longer term.

Research author Nick Maynard explained: “Tools such as restricted authorisation and digital issuance will enable pre-paid cards to benefit from the evolution of traditional gift cards into full-blown prepaid cards, driving significant revenue.”

US Is Largest Prepaid Market, but Other Opportunities Emerging

The research found that while the US will account for over 43% of global transaction values in 2026, there are other significant opportunities emerging. China is seeing increasing pre-paid use, and as international tourism recovers, pre-paid cards for travel money can benefit. The report also highlighted emerging markets as a key area of interest and recommended that platforms form partnerships now in order to best exploit future opportunities.

Juniper Research provides research and analytical services to the global hi-tech communications sector; providing consultancy, analyst reports and industry commentary.

Add a Comment

No messages on this article yet

Editorial: +44 (0)1892 536363
Publisher: +44 (0)208 440 0372
Subscribe FREE to the weekly E-newsletter