Millions using prepaid cards monthly

by. Konrad Christensen

American consumers are using reloadable prepaid cards in increasing numbers. In fact, Mercator Advisory Group reports $65 billion was loaded onto prepaid cards in 2012, double the amount loaded in 2009.

Furthermore, new research from Pew Charitable Trusts found more than 12 million people are using prepaid debit cards at least monthly. The Pew report, Consumers Continue to Load Up on Prepaid Cards, also found prepaid cards today are more user-friendly and have fewer fees than when they arrived on the scene several years ago.

There are a number of reasons consumers are using prepaid cards more often, but one thing is clear: The cards are becoming mainstream, and they aren’t just for the unbanked and underbanked population.

Another Pew report, Why Americans Use Prepaid Cards, concluded the average household income for prepaid card users is $30,000 and nearly 60 percent have used other financial service products, including checking accounts. Forty-five percent had used a credit card in the last 12 months. Additionally, fewer than half (two in five) of Americans using prepaid debit cards have had to close checking accounts due to overdraft fees.

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