The Canadian Open-Loop Prepaid Market: 2019, a study commissioned by the CPPO and conducted by Mercator Advisory Group, today revealed $4.8 billion in total dollars loaded onto open-loop prepaid cards. According to the study, total loads across corporate- government- and consumer-funded cards were up by 12 per cent over 2018 and 25 per cent over a three-year period, achieving consecutive growth between 2017 and 2019.
Prepaid’s ability to provide funds that are immediately available to a wide range of recipients is being used to drive market innovation with products that enrich the digital banking experience of users. Many payments facilitated at retailers’ point of sale by smartphone and mobile digital apps use prepaid technology, with the value for payment stored in the device or app.
“The digital shift in Canada has come to the forefront during the COVID-19 pandemic, exposing the number of consumers who already view digital payments as the norm and others who are increasingly adopting digital methods for day to day transactions,” said Jennifer Tramontana, co-founder and executive director of the CPPO. “As new technology continues to redefine the modern payment experience, growth in the prepaid industry highlights the evolution of prepaid as a foundation for innovation in the digital banking transformation, enabling fintech companies and challenger banks to bring new and innovative solutions to market.”
According to Theodore Iacobuzio, vice president of research and director of the Prepaid Advisory Service at Mercator Advisory Group: “Prepaid cards in Canada are still in the early phase of the life cycle—growth. Prepaid solutions of today will continue to evolve to meet the unique needs of the Canadian market. How quickly that evolution occurs will in large part depend on how effectively the financial institutions can integrate to, or better support, a broad range of prepaid program managers.”
Key findings from the study:
- $4.8 billion in total dollars loaded onto cards in 2019, a 12 per cent increase from 2018 and 25 per cent over the past three years.
- Total loads of general-purpose reloadable cards (cards loaded by consumers for personal finance use) grew by 10 per cent to $2.76 billion.
- Open-loop gift cards were up 17 per cent with total loads of $1.4 billion.
- Consumer Incentives and Employee & Partner Incentives segments of the Corporate-Funded Cards category was up 9 per cent in total loads.
Access to The Canadian Open-Loop Prepaid Market: 2019 comprehensive report is available to CPPO members. Please contact firstname.lastname@example.org for information on membership.