WU, NetSpend to Team on New Prepaid Card (April 22, 2014)
The GPR card space is about to get more crowded as two prepaid veterans join forces. Western Union is working with NetSpend, a TSYS Company, on a new co-branded prepaid card, to be launched later this year. The card will be supported by NetSpend’s payments platform and distributed through the companies’ combined distribution networks.
The new product is aimed squarely at the financially underserved consumer segment, which increasingly is turning to prepaid cards to spend, save and manage money. Between 2009 and 2011, the percentage of unbanked households in the U.S. that used a prepaid card climbed from 12 percent to nearly 18 percent, according to the FDIC. Those same consumers comprise a large portion of Western Union’s business.
“Combining the strengths of Western Union’s global brand and expertise in moving money with NetSpend’s deep prepaid knowledge and unique product capabilities, creates an incredible opportunity for us to better serve an underserved market,” said Dan Henry, CEO, NetSpend and 2014 Paybefore Industry Achievement winner. Details on card pricing, features and availability are set to be released nearer to launch, the companies said.
Both companies have been steadily expanding their respective portfolios. Last year, NetSpend was acquired for $1.4 billion by payments processor TSYS, a deal that gave NetSpend a competitive boost in a GPR market seeing an influx of major banks. For its part, Western Union has launched products in an array of countries, many under the umbrella of an agreement the money transfer giant inked with MasterCard in late 2011 to make electronic payments more efficient for consumers around the globe.