Visa USA today introduced the Visa Prepaid Load Network, a new service which will allow consumers to more easily purchase and add funds to Visa reloadable prepaid cards at participating merchant locations across the U.S.
The Visa Prepaid Load Network will enable Visa member financial institutions to further meet the needs of underserved consumers. According to Visa estimates, there are 80 million consumers in the U.S. who lack access to a payment card or are without a traditional banking relationship. This consumer segment receives approximately $1 trillion in annual income, pays an estimated $1.5 billion annually in check cashing fees, and relies heavily on cash for everyday transactions.
While direct deposit is the primary method many cardholders use to fund reloadable Visa prepaid cards, Visa research shows consumers also want the flexibility to add funds to their cards at everyday shopping locations, like supermarkets and drug stores. The new service will enhance the utility of existing reloadable prepaid card products offered by Visa issuers, including payroll, general purpose reloadable and government disbursement cards.
"Visa remains focused on developing the category infrastructure to support all of our key stakeholders - cardholders, merchants, financial institutions and their partners," said Todd Brockman, senior vice president, prepaid products, Visa USA. "The Visa Prepaid Load Network offers an infrastructure to respond to a direct need in the marketplace, supports the rapid growth we continue to see in the prepaid payments category, and helps our partners capture a greater share of cash and check spend."
How it Works
The Visa Prepaid Load Network is an "opt-in" service for issuers, acquirers and merchants. Using VisaNet connections, transaction message formats, and settlement processes, the service allows consumers to add funds to eligible Visa reloadable prepaid cards at a merchant's checkout counter as follows:
A cardholder presents the Visa reloadable prepaid card and funds to be added at the participating merchant.
The merchant transmits the card load amount to its acquiring bank.
The merchant's acquiring bank routes the prepaid card load amount from the merchant to the card issuing bank for approval via VisaNet.
The card issuer approves the load transaction in real-time for eligible prepaid card accounts.
The cardholder is presented with the card and a receipt and is provided immediate access to funds from the approved load transactions.
The acquiring bank settles loaded funds with the card issuing bank daily.
The Visa Prepaid Load Network provides significant benefits to all stakeholders:
Merchants gain increased store traffic and loyalty from consumers who are directed to merchant locations to reload their cards. Merchants may also see increased revenues through potential card reload fees.
Cardholders will be able to more easily add funds to their Visa prepaid cards at convenient, everyday retail locations.
Issuers benefit from an efficient system to expand their Visa prepaid card programs and develop profitable cardholder relationships.
Acquirer banks benefit from a new service to offer merchants as well as incremental revenue in the form of an interchange fee paid by the card issuer to the acquirer.
Initial Visa member and merchant participants are expected to introduce the Visa Prepaid Load Network service in late 2006 and early 2007.