The Hard Facts on Prepaid Debit Cards
Prepaid debit cards have really boomed overnight. It seems like we only saw the first of them a couple years ago, and yet, today, they’ve reached a whopping 17 or so percent of consumers. This means that nearly one in five of the people you see at the shopping mall are carrying a prepaid card. No doubt, they’re here to stay.
Prepaid debit cards have been, perhaps unsurprisingly, subject to many rumors, myths and false facts. This seems to happen whenever a new idea shoots up overnight. The popularity of the card has simply spread more quickly than the facts, so here are some of the hard facts and statistics on these cards to set the record straight.
Any statistics cited below refer to numbers taken in 2010 being, at this point, the most accurate and up to date data available on prepaid debit cards.
Who Uses Prepaid Cards?
It’s estimated that, in the last six months, six percent of consumers have used a debit card, while in the past year, at least nine percent have used a debit card. This number seems to suggest that debit card usage, month by month, has almost doubled in the last six months.
Why Prepaid Cards Now?
Prepaid cards have been around for awhile now, so why is it that they’ve only recently become popular? One theory is that the 2009 Credit CARD act may have something to do with it.
The CARD act is really there to help consumers. It’s a credit reform act that ultimately results in greater accountability for predatory lenders. That said, it does come with a number of stipulations that make it a little more difficult to get ahold of a credit card, and a little trickier to really understand your policy.
The CARD act has left many consumers essentially throwing their hands up in the air and saying “Forget it, I’ll use a prepaid debit card”, which offers many of the same benefits as a credit card but without the risk and without any lengthy and exclusionary qualification process as the post-CARD act demands of credit card providers.
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