Gold-card users to pay up to $3,000 for phone calls and texts, and text-only cards
Supporters of gold-card holders have been urging consumers to switch to prepaid cards as more customers are forced to upgrade their existing cards to the more secure Visa or Mastercard, and as new technology enables more consumers to access prepaid phone service.
The prepaid-card revolution is here, but it is only a matter of time until we get to the point where we see widespread adoption of prepaid cards and they are more widely accepted, according to two analysts with analysts at TD Securities.
In their latest report, TD Securities said prepaid-cards could play a significant role in the next few years.
The analysts cited data from the prepaid-payment provider Softcard, which showed that prepaid-Card accounts have more than doubled in volume since 2015.
In addition, they said that by the end of 2020, roughly 6.5 million Americans would be using prepaid-Cards, up from 3.8 million a year earlier.
By 2021, that number would be nearly double, with 3.6 million Americans using prepaid Cards and 1.9 million using voice-only Cards, they noted.
The growth in prepaid-cards could be driven by two factors: consumers switching to the prepaid cards to use voice- or text-based payment options and, in some cases, customers buying prepaid-bills to pay for their phone calls or texts.
To support their point, TD said they examined data from AT&T and Sprint, which both offer prepaid-payments products, as well as the prepaid card network.
TD Securities noted that the Sprint prepaid card offers an optional “billing gateway” that allows consumers to pay with their prepaid card.TD Securities noted a number of reasons why prepaid- Card users may want to switch from a traditional prepaid card to the faster, more secure prepaid-Payment, according a news release.
One is that most prepaid- Cards don’t allow a payment method other than credit cards, and some require a credit check to open a prepaid-Cash account.
Some prepaid- cards also don’t let consumers use their cards on sites like eBay, a situation TD Securities also noted is likely to increase when the market matures.
For more on the prepaid market, read our previous coverage.