A few months ago, I bought something that came with a Money Back Guarantee. The product was bunk, so in an unusual-for-me move, I actually sent my receipt and UPC code to the manufacturer and waited for my refund. It arrived about six weeks later in the form of a Prepaid Debit Card with a balance of $32.95. I appreciated the refund, but thought it odd that it was in the form of cumbersome plastic instead of a check that I could easily turn back into, well, the same cash with which I had paid.
I have never understood the appeal of Prepaid cards. What’s to like? First you have to pay for the card, then pay fees to use or reload it. It’s one more thing to carry around. They’re difficult to use at ATMs, tough to validate when shopping online, and get rejected by some stores’ credit card scanners. Often they require a herculean effort of logic and calculation to zero out completely, resulting in balances remaining on the card that are too small to bother with but too big to ignore. Frustration all around!
A need to change perceptions like these makes for a product in desperate need of innovation. Probably noting that, the folks at HYVE AG and MasterCard teamed up to present an open innovation contest aimed at creating a PrePaid Card that airlines could target to their own frequent flyers. They called it the Skies of MasterCard (though the contest is over, the website is still viewable at Prepaid-Plus.com).
The traveler market segment is a brilliant target for a prepaid debit card. Particularly when traveling overseas, a lot of cash is involved, and the process of getting, converting, and spending money abroad can be tricky. Everyone has their own preferred method: some use credit or debit cards, some always make ATM withdrawals, and some carry cash everywhere they go. I tried to think about what sort of perks, functions or features would make someone like me switch from using cash when I travel to using a Prepaid card instead. It appears many others took the same tack, as the contest garnered 180 submissions from people around the globe.
When I got an email saying I had won the contest (and the $3000 prize), I was a little surprised. The idea that landed on top was not the most innovative, but was practical and useful. I suggested an app that used my location to show me all the perks available to me based on the card(s) I held. Since many people generally carry multiple credit or debit cards, it’s sometimes tough to keep track of what perks are available where and when. A quick and easy to use “Perks Near Me” App would boost card usage and make for one less thing for cardholders to remember. Comments from the contest jury: “Great idea, love it. Would definitely get me to shop. It offers the possibility to mix it with other programs MasterCard is already offering and is applicable to other products i.e. credit or debit cards!”
If you’re wondering about that fate of the Prepaid card with $32.95 on it: I used it to order takeout for lunch one day. Lunch for two, with a generous tip to hit $32.95.