Among the most exciting aspects of the prepaid card industry is the pursuit of new, untapped markets. One such market exists on the high seas. Thousands of cruise ships, let alone container ships and other vessels, navigate the globe's waterways.
Until now, crew members were largely paid with cash or checks. So a program that allows cruise ship workers to electronically manage their pay aboard ship seems a valuable and timely solution.
For the past several years, Prepaid Solutions Inc. (PPS) has been cultivating this market for prepaid cards. Ken Goins, Chief Executive Officer at PPS, said the overall size of the payroll card market for the domestic cruise ship industry alone is upwards of $2 billion, with the two largest cruise lines in the world – Carnival Corp. and Royal Caribbean Cruises Ltd. – accounting for the bulk of that volume.
One of the cruise lines PPS works with, Apollo Ship Chandlers Inc., operates about a half-dozen ships, with roughly a $30 to $40 million annual payroll, Goins said. That metric provides evidence of the size and scale of the market.
"So it's a huge opportunity for us," Goins said. "If we were lucky to get even a small portion of that, it would be an enormous huge vertical for us to expand in the marketplace."
Goins said it has been a complicated, time consuming process to put in place the necessary partnerships and networks. PPS works with MTN Satellite Communications to provide global communications with the ships and with foreign exchange specialist Travelex for currency conversions and money transfers.
The Burr Ridge, Ill.-based processor has more than 10,000 Travelex OceanPay Visa Payroll Cards in circulation today and is in talks with several domestic and foreign cruise lines.
"The coordination of all these things is what we think makes our product so appealing," Goins said. "We're not aware of any major competitors that have anything close to what we do. There are people that do have bits and pieces of these things. But nothing certainly as integrated as what we've done."
Other complexities of a maritime payroll card program involve legal requirements and security. PPS had to comply with the Merchant Marine Act of 1920, also called the Jones Act, which regulates maritime commerce in U.S. waters, as well as the Merchant Marine Act of 1915 (Seamen's Act), which afforded legal protections to workers at sea.
Regarding security, reporting requirements for such workers far exceed those to sign up a customer for a general purpose reloadable (GPR) card, Goins said. More extensive background information, including passport information, needs to be obtained.
Additionally, the Visa Inc.-branded payroll cards are unembossed, meaning the numbers on the cards are not raised. Goins said "flat" cards reduce fraud; when stolen they cannot be used to make transactions on the old-fashioned imprinters, which are still used in many places around the world.
Because crew members work on a contract basis, they continually come and go. So PPS set up the on-board systems to allow for the encoding of the instant issue cards on site, Goins said.
Crew members manage their finances via computers on the ships, where they can transfer money in 35 different currencies and receive text message alerts via mobile phones, Goins said. Family members are mailed companion cards for person-to-person money transfers. PPS estimates that each ship employee can save as much as $50 a month using the system, since they don't have to disembark at ports to use more expensive wire transfer services.
Cruise ships are not the only vertical PPS is targeting. Commercial shipping operations do not employ the large number of people cruise lines employ, but there are tens of thousands of ships to provide scale, Goins said. Another vertical is oil rigs – about 5,000 of them worldwide, according to Goins. . "There is a large number of people working on oil platforms," he said. "It's very similar in a way to cruise ships, where [workers] sign onto a platform for three to six months, and they're paid by check or by cash – so the same sort of dynamics there."
Another untapped market is carnivals, where itinerant bands of carnies, performers and food vendors travel the country to put on fairs and sideshows.
Goins said PPS' maritime payroll card program represents only about 10 percent of the company's business, with the largest part of its revenue coming from GPR cards available at check cashing stores.
"We obviously are not the 800-pound gorilla in payroll processing," he said. "We try to find other variations of those types of applications and be successful in specialized niche verticals, which we think is probably the best thing to do to be successful in the short term and then grow from there." 
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