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January 31, 2010

Prepaid gift cards get personal

Global technology provider Serverside Group, which specialises in offering personalisation services to bank card portfolios around the world, has teamed up with UK prepaid programme manager Quantum Card Services and issuer Newcastle Card Solutions to offer prepaid cardholders the option to personalise their cards with photos and images.

By Verdict Staff

Global technology provider Serverside Group, which specialises in offering personalisation services to bank card portfolios around the world, has teamed up with UK prepaid programme manager Quantum Card Services and issuer Newcastle Card Solutions to offer prepaid cardholders the option to personalise their cards with photos and images.

The three organisations have teamed up to launch the UK’s first customisable prepaid card, a single load MasterCard-branded gift card. The card is available in denominations from £20 to £125 ($32 to $202), and cardholders can personalise the card by uploading their own images or by selecting a design from the online gallery provided by Quantum.

Prepaid gift cards are not new to the UK market, but with a plethora now available, issuers and providers are seeking the extra edge that differentiation can bring. According to Serverside, through its experience of offering personalisation services on credit and debit cards, card customisation has already been proven to result in increased transactions, acquisition and retention rates, as well as larger balances.

It also offers an immediate differentiator for marketing purposes, particularly important in the ultra-competitive prepaid market.

Personalisation a strong proposition

Serverside has pioneered the use of personalisation on payment cards, having been established in 2003. By the end of 2009, it was running more than 1,000 card programmes through its network of approximately 200 card issuers in 23 countries.

Its clients include RBS Group, Banco Sabadell, ING, Permanent TSB, ANZ, BMW, KBC, Fortis, Eurobank, First National Bank Omaha and Heritage Building Society.

By teaming up with Newcastle Card Solutions, which has already issued over half a million prepaid cards in the UK, Serverside is confident that prepaid personalisation will be a strong proposition.

Newcastle Card Solutions already has over 200 live prepaid and debit card programmes encompassing debit cards and prepaid cards, including those in the gift, teen, unbanked, travel, corporate and payroll segments.

Serverside Group says it has specifically adapted its technology to the requirements of the prepaid sector and, through its partnership with Newcastle Card Solutions, a subsidiary of Newcastle Building Society, now offers all prepaid companies a low-cost entry point into the card customisation market, whether for single load or reload cards.

Quantum will be marketing the new service through multiple channels, from online campaigns and competitions to win tickets to various live events, to affinity deals with appropriate third parties, for example, pet and gift websites and photo processors.

Kriya Patel, head of card solutions at Newcastle Card Solutions, said: “This is a significant development in the prepaid cards market and we are glad to be in the driving seat along with Serverside Group, who are the innovators in this space.

“Card customisation is a proven revenue generator and the perfect product for the prepaid card environment.”

Benefits of personalisation

Personalisation has proven to be a valuable revenue stream for card issuers and a way to establish lasting consumer loyalty to a card issuer.

Some issuers offering Serverside’s personalisation service charge an upfront fee, while others charge a fee for subsequent replacement card designs. Other issuers have opted to charge no fee at all in order to appeal to as many consumers as possible.

In a previous interview with CI, Serverside CEO Tom Elgar said the growing trend of personalisation not only offers a way for issuers to differentiate their offerings in order to make them ‘top of wallet’, but also taps into the era of user-generated content.

“Marketing outlets such as Myspace and YouTube have seen enormous growth and profits by allowing users to create their own content then share their personal creations online with others,” Elgar said.

“Consumers no longer expect to be offered a one-size-fits-all proposition. Personalisation and choice are now expected across all consumer product offerings, and that includes payment cards.”

According to a November 2008 report by US payment consultancy Aite Group, 8 out of 12 of US card issuers surveyed listed card personalisation as ‘important to extremely important’ to acquiring new customers, with the number of transactions made using personalised cards typically rising between 10 percent to 20 percent compared to traditional cards.

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