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Prepaid cards can benefit consumers of all incomes

Aug 28, 2012 Sean Albert

Subprime consumers are no longer the only ones in search of alternative finance options. Individuals of all incomes are seeking out short term lending solutions, as well as prepaid credit and debit cards, to cover necessary costs. According to The Huffington Post, wealthier consumers are beginning to use prepaid cards to pay for expenses. Although these plastic products were once mostly used by underbanked individuals - those who do not have a traditional bank account or credit card - more Americans are using the cards better manage money and make payments. The source cites research by the Mercator Advisory Group, which found the growth of prepaid cards increased by 20 percent in 2011, bringing in a total of $483 billion. Industry experts believe the numbers will keep rising, as they anticipate the total to jump to $594 billion by 2013. Prepaid credit and debit card companies across the country are experiencing success as more consumers use their products for alternative financial solutions. The Statesman reports that NetSpend Holdings Inc, an Austin, Texas-based business that provides prepaid cards, recently announced that its net income increased by 34 percent in the second quarter from the same time a year ago. Revenue also rose to $85.3 million during the quarter, representing a 15 percent jump from the same period in 2011.