Prepaid Cards Offer Solution for Shoppers Who are Concerned about Debt and Want to Stay on Budget
MONROVIA, Calif.--(BUSINESS WIRE)--As Black Friday and Cyber Monday deals usher in the holiday shopping season, a new online survey conducted in November by Harris Interactive for Green Dot (NYSE: GDOT), a leading prepaid financial services company, finds the majority of holiday shoppers are shunning credit as their primary form of payment this holiday season. Concerned about adding debt to their holiday shopping cart, 69% of shoppers plan to primarily use available funds, such as debit cards, cash, checks, gift cards as well as prepaid cards to pay for gifts this year.“Our Green Dot prepaid card is a great financial control tool that gives consumers access to all the convenience of paying with plastic, without the risk of accruing debt or having to pay interest or penalty fees.”
In their quest to avoid debt, 25% of consumers who used their credit card for holiday shopping last year said that they are less likely to use credit cards for purchases this year, and in fact, 1 in 10 said they will not be using them at all.
“We applaud consumers for being fiscally responsible this holiday season and encourage them in their efforts to have a happy and debt-free holiday,” said Steve Streit, Green Dot’s Chairman and Chief Executive Officer. “Our Green Dot prepaid card is a great financial control tool that gives consumers access to all the convenience of paying with plastic, without the risk of accruing debt or having to pay interest or penalty fees.”
Concerns about debt
According to this survey, more than half of consumers in the prime family years of 35-44 and 45-54 were concerned (55% and 58% respectively) about accumulating holiday shopping debt. And, regardless of age, women are more likely than men to say they are at least somewhat concerned about accruing debt (52% vs. 45% respectively).
As consumers strive to stay on budget, research shows that the demand for prepaid cards is steadily rising. The Mercator Advisory Group estimates that the total load volume in the United States for open loop cards will grow at a 36% compound annual growth rate through 2013 to exceed more than $421 billion in total market size.
Avoiding unplanned bank fees
Another compelling finding of this holiday shopping survey was that 45% of Americans have been charged unplanned bank fees in the past year. More than half (51%) of these adults indicated paying unplanned overdraft fees, followed by ATM fees (47%), finance charges (32%) and late payments fees (29%).
The Green Dot Visa or MasterCard prepaid cards have no minimum balance requirement, no overdraft fees and no penalty fees of any kind. In the last 12 months ended September 2010, Green Dot issued approximately 6.1 million new prepaid card accounts to Americans, who loaded more than $9.5 billion of deposits over the same period last year. These FDIC-insured cards come with all of the same consumer protections as checking accounts and provide a secure way for consumers to shop anywhere Visa or MasterCard is accepted.
This survey was conducted online within the United States by Harris Interactive on behalf of Green Dot Corporation from November 10-12, 2010 among 2,288 adults ages 18 and older. This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated. For complete survey methodology, including weighting variables, please contact brian.ruby@icrinc.com.
About Green Dot
Green Dot is a leading prepaid financial services company providing simple, low-cost and convenient money management solutions to a broad base of U.S. consumers. Green Dot also owns and operates the Green Dot Network, a leading prepaid card reloading network in the United States. Consumers can access the Green Dot Network and use it for a wide variety of transactions, including cash loading onto prepaid cards and adding funds to a PayPal account through MoneyPak(R). Green Dot sells its cards and offers reload services nationwide at approximately 50,000 retail stores, including Walmart, Walgreens, CVS, Rite Aid, 7-Eleven, Kroger, Kmart, Meijer, and Radio Shack, which provide consumers convenient access to its products and services. Green Dot's products include MasterCard(R) and Visa(R) branded prepaid debit cards and the Green Dot MoneyPak(R). Green Dot is headquartered in the greater Los Angeles area. For more details, visithttp://www.greendot.com and http://www.moneypak.com.
About Harris Interactive
Harris Interactive is one of the world's leading custom market research firms, leveraging research, technology, and business acumen to transform relevant insight into actionable foresight. Known widely for the Harris Poll and for pioneering innovative research methodologies, Harris offers expertise in a wide range of industries including healthcare, technology, public affairs, energy, telecommunications, financial services, insurance, media, retail, restaurant, and consumer package goods. Serving clients in over 215 countries and territories through our North American, European, and Asian offices and a network of independent market research firms, Harris specializes in delivering research solutions that help us - and our clients - stay ahead of what's next. For more information, please visit www.harrisinteractive.com.
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