Viewpoint: Citi Prepaid: Building on Success in the U.S. Corporate Prepaid Market
Prepaid cards are one of the fastest-growing payment types in the U.S. Prepaid cards’ popularity among consumers and the trend towards digitization of payments have contributed to significant growth in the corporate prepaid segment. For corporates, prepaid cards can offer significant cost savings over paper-based payment methods such as cash, check or vouchers, and eliminate many time-consuming manual processes. Simply put, they are built to provide businesses with a way to achieve lower administrative costs, improve reconciliation and enhance accountability. Moreover, the flexibility of prepaid cards means that they can serve many payment needs, including payroll, rebates, sales incentives and refunds.
A Value-Added Proposition
Success in the corporate prepaid card market requires providers to offer more than just cost savings and efficiency improvements. Successful providers must also present a compelling opportunity for corporates to enhance their offering and services. Prepaid cards should help companies to achieve their business, marketing, sales or human resource objectives.
Citi Prepaid focuses on the corporate prepaid market and targets specific industry sectors. As a result, it looks to develop a deep understanding of clients’ businesses and their payment challenges: its prepaid card range is customized accordingly. An in-house design team assists clients with branding while a dedicated operations team works with clients to ensure seamless processes. Citi Prepaid’s collaborative and consultative approach has made it a trusted provider for its clients.
A History of Innovation
Since it created its first virtual prepaid solution in 1998, Citi Prepaid has emphasized innovation. Citi Prepaid prioritizes functionality that delivers day-to-day benefits to users, addresses clients’ pain points and improves cardholders’ experience.
Citi Prepaid’s client-centric approach to innovation is demonstrated by its maritime payroll solution. Typically, ships’ crews are drawn from around the world and many members may not have U.S. bank accounts. In addition, crew members often remit part of their paycheck to relatives abroad. For crew members, cashing checks and remitting funds is expensive. To improve convenience for maritime staff and lower costs for maritime companies, a prepaid card solution has been developed that allows part of the employee’s salary (as specified by the user) to be loaded to a card. The remainder is then automatically remitted to the user’s intended recipients in their home country at lower FX and wire costs than would normally be applicable.
For some companies, an ability to issue payments on the spot to their employees or customers is critical. Citi Prepaid developed an instant issue prepaid card so that clients have an easy and secure payment option for real-time payments, which are also convenient for the recipients. Feedback from clients issuing real-time payment cards highlighted the importance of being able to replace lost cards with a new card that is immediately linked to the user’s existing account. In response, Citi Prepaid developed an application programming interface that makes real-time card reissuance straightforward.
Numerous other initiatives targeting specific industry challenges—such as providing real time compensation for delayed airline passengers or faster and more convenient insurance claim payments through a prepaid card—are under development.
Proactive Approach to Regulations
Regulation is a major theme in the prepaid industry and an understanding of evolving regulations is crucial to success. Citi Prepaid recently repositioned its payroll card product after the industry came under scrutiny from multiple regulatory bodies. The resulting enhanced payroll card product is designed to exceed the requirements set by regulators, while being cardholder friendly and safe for clients. As prepaid matures as a consumer financial product, regulation is likely to become more rigorous. Providers that understand the evolving regulatory landscape and the challenges facing the industry will be best positioned to offer clients the security and cardholder experience they require.
Citi Prepaid’s client-centric innovation and focus on cardholders’ experience have made it a market leader in the corporate prepaid segment: Business has grown by more than 45 percent in the last three years. By targeting specific corporate markets, Citi Prepaid can align its sales and servicing teams’ knowledge and expertise for effective use. As a result, its solutions are positioned to address important challenges faced by clients.
The consumer payments space is set for significant disruption as the pace of innovation accelerates. Payments providers need to be nimble and embrace change to succeed in this sector. Citi Prepaid will continue to focus on technology and talent to remain at the forefront of innovation. By combining its commitment to innovation with its client-first mentality, Citi Prepaid is strongly positioned to lead the market.
In Blogs & Viewpoints, prepaid and emerging payments professionals share their perspectives on the industry. Paybefore endeavors to present many points of view to offer readers new insights and information. The opinions expressed are not necessarily those of Paybefore.