Credit unions offering gift cards often overlook expanding their prepaid portfolio with reloadable cards. “Why would we ever need both?” is a question we hear often. 

While gift and reloadable cards are both open-loop, prepaid products, this is where the similarities stop.

Gift cards are typically occasion-based, evoking a one-time purchase. Reloadable cards, on the other hand, are purchased to finance ongoing needs.  Not only can it expand the member-credit union relationship, reloadable cards can also increase income through ongoing interchange.

In addition, reloadable cards have the potential to open a credit union’s doors to an entirely new market – the underserved. Zealously marketed to by check cashers and payday lenders, this demographic is eager for an alternative, and the reloadable card gives them exactly that. It’s a low-cost and safer alternative for managing their money.

Not only does the credit union receive income from the sale of the card and the potential for future income each time the card is reloaded or transactions occur, they gain a potential new member. Rather than turn down the customer because he or she did not qualify for a traditional program, the credit unions can offer a solution. The credit union is creating what could be the beginning of a more lucrative relationship down the road.

This is only one example of the many ways a reloadable card program can bolster your credit union’s prepaid portfolio. To learn more, check out our white paper “Reloadable Cards – It’s All in the Marketing.”