Reloadable prepaid card customers are gaining more touch points from which they can get their bank account queries answered.
Indeed, U.S. Bancorp and PNC Bank rolled out mobile apps for their reloadable prepaid products in December, thus adding to the ways in which customers can resolve their account questions. The rollouts point to minor usability improvements.
"Having a well-designed mobile app can really help [consumers] measure their [finances] better and more conveniently," says Rob Levy, director of research at the Center for Financial Services Innovation, a company that focuses on underbanked consumers.
U.S. Bank, which has been beefing up its prepaid card business, released an iOS app for its Convenient Cash product, a reloadable prepaid card.
"It's all about customer service," says Dave Smith, senior vice president of prepaid product development at U.S. Bank.
Upon initial release, consumers can get their basic queries like, "What is my transaction history?" answered through the app instead of having to ring the call center to find out. They can check their account balance, locate branches or ATMs, view direct deposit information and see the latest offers. However, they aren't able to enroll in the product through the mobile app.
Smith hinted at how some of the app's basic functionalities will mature. Take the app's "view latest offers" feature, for example. Though the button on the app is mostly meant for displaying marketing messages now, Smith says the bank is researching how to include special deals. Perhaps a customer will get an offer based on what he has previously bought. "There are a lot of different opportunities," says Smith, adding the bank will test out a few before settling on one.
Also looking ahead, U.S. Bank is looking for ways to make loading funds easier for its prepaid customers and also plans to launch a similar app for Android devices in the first quarter of 2013.
In recent months, more companies have been pushing out and enhancing their prepaid products. That includes big players like JPMorgan Chase growing out the availability of its Liquid prepaid card, a product that is also accessible on mobile devices. Their customer objectives vary.
"Different banks are exercising different strategies," says CFSI's Levy. Some banks view the product as a way to attract new customers, while others are targeting existing customers, while still others are taking a hybrid approach, he explains.
"The distinction between an underbanked and banked consumer is becoming increasingly hard to define in this era," wrote Levy in an email.
Smith says U.S. Bank has found that a large percentage of its prepaid customers are existing bank customers. That finding "really goes back to what the product can be," Smith says. In one definition, the reloadable prepaid product is meant to serve as a budgeting tool. But there are other definitions. To some in the industry, the prepaid card is thought of as an alternative product for those who don't have checking accounts.
For the underbanked prepaid customer, mobile offerings are paramount.
"A lot of research shows that underbanked customers are more likely to have smartphones than the average population," says Levy, adding that points to how the group may use mobile as a substitute for online access through a computer.
As such, he views mobile check capture and ways to help consumers build their savings as two important features to also include in mobile apps. He highlights Plastyc, which his company has invested in, as one such company that offers more robust features.
"There are more apps out there," Levy says.