WASHINGTON, Oct. 6 /PRNewswire-USNewswire/ -- Business Solutions, a subsidiary of the American Bankers Association, has launched a new program that will enable community banks to offer customers a variety of Prepaid MasterCard card products, including general purpose reloadable, payroll and gift cards.
Working with TransCard, a leader in prepaid card processing, and MasterCard Worldwide, Business Solutions is now offering the Community Bank Prepaid Program, a turnkey product for community banks to issue Prepaid MasterCard cards and create a new revenue stream through card services that can be offered to a large, yet untapped customer base. In addition, customer deposits made to these prepaid cards will count in the overall deposits for the bank.
Bank customers can use these FDIC-insured prepaid cards to pay employees, support college students or help young people learn to budget their finances. Users of the cards will no longer have to use expensive check cashing services or carry around large amounts of cash. Instead, they will have cards that can be replaced if lost or stolen.
"This is a real opportunity for banks to expand their revenue by reaching out to members of the under-banked community, who have expressed a desire to have more control of their money," said William Kroll, president of Business Solutions. "It also offers bank customers a safe way to teach their teenage and college-age children how to budget their finances."
"This program eliminates the traditional barriers of entry for banks to become prepaid issuers," said TransCard CEO Craig Fuller. "TransCard will provide banks with a turn-key, bank branded, prepaid program that can expand their deposit base, create new offerings to their retail base and establish prepaid products for their treasury relationships."
Prepaid spending has become especially popular during these difficult economic times. According to a 2010 study by the Boston Consulting Group and commissioned by MasterCard Worldwide, total global prepaid spending is estimated to reach $840 billion by 2017. $442 billion of which is expected to be spent in the U.S.
The Community Bank Prepaid Program is an affordable and efficient way for community banks to tap into this trend. The program offers bank customers cards that have a virtually 100 percent approval rate for their users and no risk of overdraft fees. For commercial clients, prepaid payroll cards are more cost-effective and convenient than issuing employees paychecks which can cost employees time and money to cash. Instead, the users will have immediate, 24-hour access to their money.
In addition, cardholders will be able to use their mobile phones to pay bills, check their balances and receive text messages when there is a transaction on their account or their balance is low. This is especially important to members of the under-banked community, who comprise approximately 25 percent of Americans according to a 2009 FDIC survey, and have expressed a desire to use banks so they can have better insight and management over their personal finances.
Business Solutions is a principal member of MasterCard. MasterCard is a registered trademark of MasterCard International Inc.
About American Bankers Association
The American Bankers Association represents banks of all sizes and charters and is the voice for the nation's $13 trillion banking industry and its 2 million employees. The majority of ABA's members are banks with less than $165 million in assets. Learn more at www.aba.com.
About Business Solutions
Business Solutions offers ABA members competitive products and innovative solutions selected by bankers for bankers that will help you save money, build customer relationships and improve your bottom line. Our unmatched, value-added products and services in Mortgage Solutions, Payment Solutions, Capital Markets, and Commercial Lending & Business Banking will minimize your expenses, maximize your bank's performance and, in many cases, offset your ABA dues.
TransCard (www.transcard.com) provides custom, turnkey prepaid programs for corporate, non-profit and government organizations. TransCard is one of a few privately held core processors in the world, providing prepaid debit card solutions branded with MasterCard®, Discover®, STAR and PULSE associations. The company specializes in on-demand prepaid programs using a sophisticated proprietary technology platform that was built in-house to meet the unique needs of clients in various industries. Along with the most robust suite of value-added cardholder benefits- including mobile banking, online bill pay, free credit scores and a Personal Financial Management tool that budgets, tracks spending and has customizable widgets-in prepaid, TransCard offers 24/7/3 65, live, bilingual customer service and a check-free online account accessed through an easy-to-use website.
SOURCE American Bankers Association