With an increasing shift to all things digital, digital banking solutions like challenger banks and neobanks, are poised to make inroads as go-to banking alternatives for those looking for other options than a traditional offering. And with debt load at an all time high due to COVID-19, many are looking for debt-free account alternatives that still provide all of the key features of a bank account without the heavy fees or cumbersome setup process.
Adding prepaid card accounts to your challenger bank offering can significantly increase your customer base, as well as target individuals looking for debt-free alternatives. So, let's take a look at the benefits that adding a prepaid card account to your challenger bank will provide.
Debt-Free Product Offering
With COVID-19 highlighting the cons of owning lots of debt products, many consumers are looking for debt-free banking solutions, avoiding credit cards that accrue debt and interest. Prepaid card accounts allow your consumers to load actual funds to their card, receive payroll direct deposits, and more. This provides your consumers with the ease of always knowing exactly how much money is available to them without the worry of looming debt.
Bank Account without the Bank
Prepaid cards are customizable to your challenger bank's core offering and can be configured with a multitude of capabilities that still provide your customers with a full banking experience but from within your own customer experience. Some capabilities/additions include:
- DDA (demand deposit account): chequing account functionality
- Bill Payments: allow for recurring bill payments
- P2P transfers: transfer of funds to peers
- Contactless payments: provides tap capability at POS
- Corporate load and/or consumer load capabilities
- Real time transfers
- And more
If you're solely online, and don't have many physical products in market, a prepaid card can be a great tool not only for branding/wallet real estate, but also for gathering proprietary data to help inform customer acquisition and product roadmap strategy. Similar to most Visa and Mastercard cards, your prepaid card accounts can provide you with first party data insights into purchase and spend behaviour trends. This can help inform customer acquisition marketing strategies including geographical hotspots, online and in-store merchant categories, as well as what products/features are being used most i.e DDA, bill payments and so on.
With consumers citing ease of setup, better experience, better quality and more innovative offerings as some of the reasons to switch to challenger banks, adding prepaid card accounts to your product line becomes an obvious choice. It allows you to not only provide your customers with better/expanded services, but also provides insights into how to improve products, understand your customers and market directly to them with first party data.