Prepaid payment products provide an alternative way to pay for goods and services.
Prepaid products such as cards or electronic vouchers are pre-loaded with funds that can be used to make payments and in some cases to withdraw cash from ATMs. Funds may be loaded by consumers, corporates or by governments.
Prepaid products may be used by people wishing to budget their spending or as a means of storing value in a secure manner while travelling. In some regions they may also be used by unbanked individuals as a means to accessing payment services. Alternatively, consumers may use prepaid cards to transfer funds to another individual – for example a gift card, a youth card or a service used to remit funds to family in another country.
Prepaid cards are generally termed 'closed' or 'open' loop. A closed loop card can be exchanged for goods and services only in a limited and pre-defined number of outlets, for example, store cards, fuel cards or transport cards. In contrast, open loop cards are branded by one of the card schemes (e.g. American Express, MasterCard, Visa) and can be used at multiple locations around the world, both at retail outlets and in some cases to withdraw cash from ATMs. Prepaid cards and vouchers can also be used to make payments online.
Prepaid cards may also be sub-divided into those that are reloadable and those that are non-reloadable. In general terms non-reloadable or single-use cards are purchased or issued with a fixed value pre-loaded onto the card and cannot be 'topped-up'. Examples include gift cards or cards issued as part of an employee reward or incentive scheme. Reloadable cards may include travel money cards or payroll cards which can be reloaded with funds as needed and used for everyday purchases.
All references to prepaid products on this website are regarded as broad stroke references to network branded, open loop, closed or restricted loop, paper gift vouchers, paper certificates, gift cards, e-vouchers, digital vouchers, mobile gift vouchers or mobile gift cards along with other devices which are collectively regarded as ‘prepaid’.