There has been a recent change in the way Americans are handling banks and money. In the past it was not only common but also necessary to have a checking account. A checking account was also a prerequisite for many loan inquiries. No checking account meant that no lender was even going to look at a credit application. Today more people are starting to abandon the regular old checking account in favor of a new way to store money.
The idea of using a piece of paper to write and I.O.U. Will seem very strange to people in ten years. Checks and checking accounts are starting to disappear from society. People are opting to choose an easier way to pay for their purchases, and it is in the form of a prepaid credit card. It is small enough to fit in a wallet, and easy enough to use. By the time a consumer has finished filling one check, five consumers have already paid for their purchases with a prepaid credit card. This is great news for consumers, but where does this leave banks?
Banks are always looking for ways to make more money. The whole reason a bank exists is to make money. Banks all over the country are now starting to add prepaid debit cards to their line of bank products. Some banks are aggressively pursuing this option of payment more than others.
One of America’s largest banks, JPMorgan Chase recently launched a new prepaid credit card, and they are actively pushing this prepaid credit card onto their current customer base. It makes everything easy for the banking giant. There is less paper for them, less overhead, and fewer employees to handle the new Liquid prepaid credit card. Consumers will be able to get and load a card at any Chase ATM.
The card can then be used anywhere a Visa card is accepted. When the card is empty, consumers can just reload the card at a local Chase ATM. All of this will only cost consumers a small monthly fee of $4.95. This may look great to consumers, but it just makes more money for JPMorgan Chase. Other banks are lining up to make more money too. Wells Fargo recently started offering the very same option to its customers.
The prepaid credit card model is big business for banks and other companies that are offering this service. In 2011 consumers loaded over 50 billion dollars onto prepaid credit cards. That really pales in comparison to what is being predicted for the future. Analysts are thinking that by the year 2014 consumers will be dumping over 160 billion dollars into prepaid credit cards.
Even with the addition of prepaid credit cards consumers are still looking for loans at an all time new high. Loans.net has seen a huge increase in loan requests and approvals in the past few months. The economy is starting to come back around, and consumers are starting to spend more money. This is a good sign for both consumers and banks.