MasterCard Research: Industry Must Bridge Education Gap to Serve Financially Excluded in Europe (Sept. 17, 2013)
Sept. 17, 2013
The prepaid industry has a big opportunity in reaching the financially excluded and underserved across Europe, but it also has a lot of work to do to bridge the consumer education gap, according to new research from MasterCard Worldwide. The payment network today unveiled the “Road to Inclusion,” a report that shows while respondents identified many potential benefits of prepaid cards (once products were explained), general consumer awareness of prepaid remains limited:
- Only 11 percent of respondents had used prepaid cards
- 43 percent had heard of them but not used them
- 46 percent had never heard of them
Despite this limited awareness, there were some encouraging signs of interest in prepaid among respondents:
- 32 percent said they would like more information on prepaid cards,
- 41 percent said they would benefit from prepaid cards by not having to carry cash all the time
- 25 percent said prepaid cards would help them control their spending
The findings were unveiled at the 2013 MasterCard Europe Prepaid Conference in Rome today. The study covered six European countries: the U.K., France, Italy, Spain, Poland and Russia, although the results show attitudes and behaviors don’t differ that widely by geography, according to MasterCard. Research was conducted with the financially excluded (those that do not have access to the formal banking facilities) and the underserved (those that do not have access to any form of electronic payment).
Both groups share the most popular reason for not having a bank account: 25 percent of them say they don’t have enough money. Other reasons were: they “don’t want or need” a bank account, they aren’t allowed one, or they don’t like or trust banks.
“In Western Europe alone, the population of unbanked and underbanked totals 93 million people. What’s interesting is that prepaid cards can really be the bridge for so many to feel financially included, keep their money safe and to learn more about budgeting. This road is also part of being socially and technologically included, and we need to do more to educate these groups about the possibilities,” said Jennifer Rademaker, senior vice president of core products, Europe at MasterCard.
Ipsos MORI conducted the study in June and July 2013, using a mixed-method quantitative survey and ethnographic approach. In all, 631 people were surveyed and 36 households took part in day-long ethnographic interviews.