Thursday, December 16, 2010
Fed study shows prepaid fastest growing noncash payment type
According to the 2010 Federal Reserve Payments Study, transaction volume on prepaid cards was the lowest among noncash payment forms in 2009. However, prepaid cards represent the fastest growing noncash payment type overall, the study said.
The study compared electronic payment trends in the United States from 2006 to 2009. In that time period, the number of overall prepaid card transactions grew 21.5 percent year over year, from 3.3 billion in 2006 to 6 billion in 2009. Meanwhile, the dollar value on the transactions in that time frame kept pace at 22.4 percent yearly growth.
Closed-loop, private-label gift cards were still the most ubiquitous of prepaid cards, with 2.7 billion transactions processed in 2009, the study said. Additionally, the study reported 2 billion transactions in 2009 were made using electronic benefits cards, such as for social security and unemployment payments, while open-loop, general-purpose reloadable cards accounted for 1.3 billion transactions last year.
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