Savings Helps Customer Retention

by Ben Jackson 0

By Ben Jackson, Sr.Analyst, Mercator’s Director of Marketing

Prepaid card providers tend to focus onhelping consumers spend money, but some have found value in helpingthem save money. Attaching a savings account to a general purposereloadable card has led to more loyal customers who hold onto theircards for longer periods of time. Not to be outdone, some retailersare also considering offering prepaid card savings features as akind of “Christmas club” or layaway plan.

It is a mistake to think thatconsumers who do not have bank accounts do not or cannot savemoney. It would also be a mistake to think that prepaid card userswould not be able to save any money.

Consumers at all levels are capableof budgeting and savings. The question is whether they leveragethose savings as an account or as cash somewhere else.

Savings accounts could be a way forfinancial services companies to open and develop long-termrelationships with customers who have financial needs that gobeyond transactional tools.

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