Fifty-six percent of credit union members purchase prepaid products, but only 5.6 percent purchase them from their credit union. With more than half going elsewhere to make their prepaid purchases, credit unions are only seeing 1 out of 20 of their customers buying their prepaid products. The data show consumer preferences on where to purchase their prepaid products boils down to convenience.
The findings come from new research commissioned by Mesa, Arizona-based Better ATM Services, a technology innovator in the ATM and prepaid industries. Better ATM Services CEO Todd Nuttall offered an initial look at a few key findings, which he said underscores the very strong correlation between ATM usage and prepaid users, during a presentation at this week’s ATMIA’s U.S. Conference 2013.
Nuttall said the research also demonstrated the continued strong bond people maintain with ATMs. The data show 70 percent of all ATM users buy prepaid products and they see the ATM as more convenient than a McDonald’s drive-thru window. Nuttall said it’s apparent from the findings that the very reason people are purchasing prepaid products outside their financial institutions – convenience – can be reversed by moving prepaid products to the 24/7 convenience of the ATM.
The research, conducted by Steve Elliott Marketing Research, surveyed thousands of credit union members at five credit unions geographically dispersed across the U.S. Nuttall said the company commissioned the research because, while there is significant data about ATM use and prepaid products, no research existed correlating the two. Credit unions were selected for the study because they tend to enjoy a strong relationship with their members and are more easily able to engage their members to try new products and services. Nuttall said industry experience and previous research data demonstrate there is only a one or two percentage points difference between credit union member and financial institution customer behavior.
Other data he offered supported previous research findings. For example, he said nearly 50% buy prepaids for birthday gifts, while nearly 45% buy prepaids for holiday gifts. Forty-eight percenbt of prepaid buyers buy two or more prepaid cards at a time. Data also demonstrated prepaid card usage for personal spending and budgeting.
In the weeks ahead, Better ATM Services plans to release a comprehensive look at much of the key data in the research findings.
Better ATM contributed this Featured Story to PaymentsJournal.