The first prepaid card in India was introduced in 2001 and since then the market is continuously increasing. An article published in The Times of India on June 19, 2022, reported that contactless payments had increased from 2.5% in December 2018 to 16% in December 2021. According to the report, cards have a 26% impact on digital transactions.
Prepaid cards have proved to be one of the most cost-effective and effortless provisions to save money from an individual to large-scale corporate. These are the perfect replacement to bear a huge amount of money in the pocket; a stored-value card contains a fixed sum of money that has already been stored by its user. It is not likely operated by a bank account but with a direct “payment account”.
Why choose pre-loaded cards?
Helps manage expenses- Segregating a specific quantity of monthly expenses in advance from the total monthly funds can help in saving money for households and even small businesses.
Remote product- Evidently it is an easier way to move a certain amount instead of carrying a bulk of cash in a pocket.
Keep records- It is a product that helps its end-user to supervise their daily expenditure.
For everyone- One can divide the expenses as per company needs and issue cards to everyone with constant monitoring of expenditure.
Security- A safe means to hold money because of the instant blocking services in case of any theft or loss.
What does the Indian market offer?
The market of prepaid cards in India offers its customers to select wisely with the help of different sections in which the cards can be identified.
Type of cards.
These facilities allow customers to purchase from any retailer or store anywhere around the globe.
Classification according to the services provided.
Services for institutions and retailers.
Remarks on the recent market situation
In the latest update on June 20, 2022 RBI has prohibited NBFCs (Nonbank finance companies) to load PPI (Prepaid payment instrument) through credit lines. As per RBI, fintech companies have misused the freedom of BNPL (Buy Now Pay Later), and customers are overusing the services and drowning in a pool of debt.
To make these debts come to an end RBI barred companies from giving small ticket fintech loans which will stop the digital wallet and stored-value cards that are using credit techniques for merchandising.
Even with these restrictions, cards can still be filled with a certain quantity before being used. Users are free to use their pre-loaded cards for payments and transactions. For any cardholder who wishes to acquire a pre-loaded card, BankIT is able to provide its services according to the user's needs.