11th Annual U.S. Prepaid Cards Market Forecasts

by Ben Jackson 0

The report titled

11th Annual U.S. Prepaid Cards Market Forecasts, 2014–2017 provides an analysis of the growth and development of the prepaid cards industry through 2017. The report overviews load, growth, and market dynamics in the United States across all prepaid segments.

Mercator Advisory Group’s forecast report identifies key segments that will continue to witness a decline over the next few years as well as those that should see growth. The economy, politics, and consumer behavior will all influence which segments grow and which decline.

This report reviews and forecasts load dollar volume and card volume for both open-loop and closed-loop segments. This forecast highlights the segments approaching market saturation as well as those that will continue to experience double-digit annual growth.

“The fluctuating economy has made the prepaid market much more dynamic, with some segments benefitting and others seeing slower growth,”

Ben Jackson, director of Mercator Advisory Group’s Prepaid Advisory Service, and author of the report, comments.

Highlights of the report include:

  • In this annual forecast report, Mercator Advisory Group has taken a largely conservative approach to forecasting prepaid market growth due to the current state of the U.S. economy, the uncertain regulatory environment, and rapidly changing payments technology.

  • This forecast assumes that the slow economic recovery will continue and that government benefit programs will continue to shrink, with the exceptions of Social Security and Court-Ordered Payments.

  • The two largest segments traditionally have been closed-loop In-Store Gift Cards and Nutrition Assistance. The Money and Financial Services segment overtook closed-loop Nutrition Assistance cards in 2013, and, if the current weakness in closed-loop gift cards continues, it will become the largest segment in 2014.

  • Based on the much larger total closed-loop market size, the open-loop market will not surpass the closed-loop market until 2017, individual segments notwithstanding. The fastest growing segments are forecast to be the open-loop FSA/HSA Tax Deferred Programs segment, open-loop Money / Financial Services segment, and the closed-loop Digital Media segment.