The prepaid bank card market - France (2024)

1.2 A fast-growing global market

Payment methods worldwide and in Europe

Distribution of online payment methodsWorld, ****/****, as a percentage

Source: ****

When it comes to online payments, there is a notable variation in payment method preference between the global and European scales. on a global scale, the use of e-wallets is significantly higher than in Europe, where they represent only **%, compared with **%. As a result, Europeans give greater preference to debit cards, bank transfers, deferred payments and direct debits.

Breakdown of payment methods at physical points of sale World, **** - ****, in percent Source: ****

The chart shows a growing trend towards the use of e-wallets at physical points of sale, with a forecast increase from **.*% in **** to **% in ****. At the same time, the use of credit and debit cards and cash is declining. Other payment methods, such as on-site financing and prepaid cards, remain marginal. This indicates a transition to digital and a reduction in the use of cash in physical transactions.

Prepaid card share by world region

Share of prepaid cards by world region and distribution channel World, **** - *****, as a percentage Source: ****

According to this graph, prepaid cards will be most widely used in the Middle East and Africa in ****, for both online and point-of-sale purchases, ...

1.3 A fragmented French market

Overview of the French prepaid card market

The French prepaid bank card market ischaracterized by its accessibility and diversity. These cards, which are available to everyone regardless of income or banking status, stand out for their ease of use and security. They are particularly well-suited to people who want to control their spending, or to those who are bank-deprived, or who make online purchases. These cards can be purchased anonymously or by name, and are available from banks, online retailers, tobacconists and certain convenience stores.

In terms of functionality, these cards work like traditional bank cards, but without the possibility of overdraft, as they are not linked to a bank account. The fees associated with these cards vary from provider to provider, including different management fees and withdrawal costs. What's more, some cards offer advantages such as reduced foreign exchange and withdrawal fees, and most allow you to obtain a RIB.

When choosing a prepaid card, it's important to consider factors such as anonymity, spending limits, card costs and usage fees. Offers vary between online banks, neobanks, and cards available directly from certain merchants or exclusively online.

As a result, the prepaid card market in France offers a range of solutions ...

2.1 The French and means of payment

Distribution of payment methods

The year **** marked a continued increase in the use of non-liquid payment methods, a trend that began with the health crisis. Within the real economy, **.* billion transactions were recorded , totaling around **,*** billion euros. This represents a significant increase on ****, when there were **.* billion transactions totaling **,*** billion euros.

Over the past ten years, card payments have become an increasingly important part of cashless payments. By ****, thanks to its versatility - usable in-store, remotely, and on mobile devices - the bankcard has strengthened its position as the most frequently used payment method, now accounting for over **% of all cashless payments. This share was **% in ****, as shown in graph *. It thus stands out clearly from other payment methods, such as SEPA transfers and direct debits, which show relative stability in their use, or checks, whose use has fallen by **% since ****.

Number of payment methods France, ****, in percent Source: ****

Breakdown of payment methods, in amounts France, ****, in percent Source: ****

In ****, non-cash payments made by individuals, businesses and public authorities climbed to **.* billion transactions, marking an *.*% increase on the previous year, and totaling **,*** billion euros, a slight rise of *.*%.

The instant transfer has seen notable growth, with an increase of **% in number ...

2.2 Bank card habits

the bankcard continues to gain ground among payment methods, showing growth in **** in both number of transactions and total value, with increases of **% and **% respectively. Despite this upward trend, the total amount of fraud on cards issued in France has stabilized at *** million euros. This stabilization is mainly attributed to the widespread adoption of enhanced authentication for online transactions throughout ****. Nevertheless, card payments over the Internet remain the main vector of fraud, accounting for around a quarter of transactions (***), but still concentrating **% of fraudulent amounts.

The use of bankcards France, **** - ****, in billions Source: ****

The graph shows the evolution of the share of contactless payments in proximity card payments in France from **** to ****. There has been a significant increase in the use of contactless payments in terms of both volume and value. In ****, only *% of transactions were contactless in volume and less in value, while by ****, this proportion has climbed to **% in volume and **% in value. Growth is particularly marked from **** onwards, which could reflect the impact of the COVID-** pandemic and the shift in payment habits towards contactless methods for reasons of hygiene and convenience.

Share of contactless payments in convenience card payments France, ****-****, in Source: ****

Perception of payment ...

2.3 Other uses for prepaid bankcards: banking independence for young people, foreigners, people in financial difficulty, etc...

One of the raisons d'être of a prepaid bank card is the access it gives to people in difficulty, whether they are unbanked or bank-deprived (***).

The unbanked

In France, we have seen that in ****, *% of the population will be unbanked, which represents * million French people[***].

The unbanked

A person may be banned from banking following a payment incident, such as the issue of an NSF check, forgery or falsification of a check or bank card, etc. The people concerned are registered in the Fichier Central d'Interdiction Bancaire (***), and the number of registrations has been falling for several years:

People registered with the FCC for cheque-issuing bans and bank card withdrawals France, ****-****, in millions of registrants Source: ****

The Banque de France records the number of FCC registrations, which it separates into three categories:

People subject to a legal ban on issuing checks, Persons subject to a bank cheque-writing ban, Persons subject to a decision to withdraw their CB bankcard.

The number of prohibited bank customers fell fairly linearly between **** and ****, by -**% over the period studied, to reach ***,*** by ****.

2.4 Other uses for prepaid bankcards: banking independence for young people, foreigners, etc...

Prepaid bankcards can therefore be a way of helping people in difficulty, for whom this method is the only way of gaining access to a payment card, but they are not the only ones for whom prepaid bankcards are of interest.

*) For young people:

As children reach adolescence, they start asking for money, which is why prepaid bankcards are a good alternative: in part *, we'll look at the specific offers available for teenagers, but first we'll look at this segment of the population, which in **** numbered *.** million **-** year-olds and *.* million **-** year -olds[***].

at what age? On average, young people started receiving pocket money from the age of ** years and * months, the age when children start secondary school. how often? **% of young people received money regularly: *% every week, **% every month and *% twice a month. **% received money occasionally: **% when they needed it and **% only for special occasions such as Christmas or birthdays. *% of teenagers never received pocket money. How much pocket money? Trend in average monthly pocket money received by teenagers France, ****-****, in € Source: Pixpay The amount of pocket money almost doubles during adolescence. France, ****, in € Source: Pixpay What means of payment?**% of teenagers had a payment card in ...

2.5 Prepaid cards: a double-edged sword against fraud

Prepaid cards: the ideal tool for fraud?

The use of prepaid cards, while convenient, has proven to be a channel for various frauds, largely due to the anonymity they allow. Since ****, restrictions have been introduced to limit such abuses, such as money laundering.

After Sala Abdeslam used these cards in the November **, **** attacks, the French government wanted to lift anonymity in ****, a move that met with opposition from the French Association of Payment and Electronic Money Institutions. Nevertheless, a decree in France limited the overall capacity of these cards to **,*** euros, with a monthly spending limit of *,*** euros.

In ****, a phenomenon around geolocated conversations on Telegram was observed. This application, touted for its secure encrypted messaging, has become a breeding ground for fraudulent ads, exploiting a prepaid bank card top-up system to extort money.

Prepaid cards: the ideal solution against Internet fraud?

On the other hand, prepaid cards can be a way of protecting yourself against fraud and misappropriation of bank details. With a limited balance and dissociation from main bank accounts, they offer a degree of security for online purchases.

The health crisis has accelerated the growth of e-commerce, with a significant increase in online transactions. In ****, over *.* billion transactions ...

3.1 A complex structure for prepaid bankcards: payment card and e-money card

The prepaid card has different statuses, and this is reflected in a report by the Banque de France, theObservatoire de la sécurité des moyens de paiement l'épargne réglementée, where the prepaid card appears in several definitions:

"The payment card is a category of payment instrument offering its holder the functions of withdrawing or transferring funds. There are different types of card: - debit cards [***]- prepaid cards enable electronic money to be stored."

The prepaid card is therefore a payment card according to this part, with the precision that it stores electronic money, moreover according to the Règlement (***) ****/***, the prepaid card is "a category of payment instrument enabling the storage of electronic money within the meaning of Article *, point *, of Directive ****/***/EC.". further on in the Banque de France text we are led to this definition:

"Electronic money constitutes monetary value which is stored in electronic form, representing a claim on the issuer which must be preby another payment instrument, and which can be accepted in payment by a natural or legal person other than the electronic money issuer. There are two categories of electronic money media: - physical media such as prepaid cards,- ...

3.2 Prepaid card production and use

Now that we've grasped the concept and category of prepaid cards, let's take a closer look at how they are produced and used:

Production

The bank card is a rectangular piece of PVC (***) containing a chip, a magnetic strip and a number of markings required for security. The main production stages are as follows:

Inserting: Initial assembly is coordinated by an inserter (***), and adds security features such as a hologram.security features such as holograms, magnetic strips or predefined decorations. Personalization: There are two distinct production processes: cards with standard illustrations and cards with personalized illustrations. In the latter case, the cards arrive white, with only the Visa/Mastercard logo and chip. The first step in the personalization process is the encoding of personal data on the magnetic stripe. Next comes the data feeder for the chip. In the case of cards with personalized illustrations, these are applied at this point* Identification: Two processes can be used. Typing in the sixteen-digit card number and the cardholder's identity, which allows the card to pass through a shoe, and then applying a blank script of numbers and letters, which are then varnished: embossing.

Finally, the visual cryptogram is stamped on the back of ...

3.3 Main distribution channels

Prepaid cards can be distributed through various channels:

Bank: if the card is associated with a bank account Internet: after signing up with an online bank or neobank, the card is simply delivered to your home, a tobacconist's or a retail outlet. At atobacconist's or convenience store (***): Many cards, such as Nickel cards, are sold in tobacconists' shops, which makes them very accessible and allows you to remain anonymous when making a purchase. Telephone: dematerialized cards, such as N**, Revolut, Lydia, etc., allow you to have a card via your telephone.

4.1 The different prices of prepaid bank cards

Here's a summary table of different prepaid bank cards (***).

Source: ****

For the cost of a foreign currency withdrawal, some establishments add a fee based on a percentage of the amount, between *% and *%. There are also ceilings for account loading and withdrawals. Few offers allow you to top up with cheques, and most allow you to do so with a bank card at different fees, as well as with bank transfers or direct debits, but these often incur fees that vary from one company to another. Details are available here.

Some brands offer different packages, for example Transcash Access and Transcash Max, or PCS Chrome/Black/Infinity, which explains why the figures for PCS chrome are significantly lower than the rest: depending on the package chosen, services and fees differ.

However, the table does help us to understand the multitude of players on the market, as well as the wide range of services on offer, enabling everyone to differentiate themselves on the service they want.

The list of cards in the table is not exhaustive, as others are available on different rankings, such as that of meilleure-banque.com (***) or Selectra.

When comparing prices, it's important to look at both the purchase price ...

4.2 Different types of products

There are many different products in the prepaid bank card sector: in addition to open-circuit cards, which can fulfil the role of a real bank card, there are numerous closed-circuit or restricted prepaid cards, dedicated to a particular brand or sector. A further distinction can be made between anonymous prepaid cards (***) and cards with prior identification.

Here are a few examples of these cards, taken from a study by Infosys:

Open-circuit cards (***) usable at all Visa or Mastercard points of sale, depending on the card, for example. Prepaid gift cards. Payroll cards, set up for unbanked employees. Transit cards, used to pay transportation costs. Prepaid student cards, used to pay for food at university, for example. Prepaid insurance cards: cards provided by insurers to make claims processing more efficient. Commercial prepaid cards, used by employees for specific expenses on behalf of a company.

4.3 Prepaid bank card trends: security, service, design

Enhanced security and flexibility for prepaid cards in ****

Prepaid cards in **** offer enhanced security and flexibility for online payments and everyday transactions. Options like Skrill, Viabuy, and Nickel stand out for their adaptability to different user profiles. Skrill offers free payments in physical stores and online, with various top-up limits of up to **,*** euros/year or even unlimited. Viabuy, suitable for both professionals and individuals, offers a variety of service levels, with ceilings ranging from *** euros to unlimited deposits per month, and even accepts bitcoin top-ups. Nickel, renowned for its flexibility, offers ceilings of *** euros/month and an annual management fee of ** euros [***].

In terms of regulations, anonymous prepaid cards have a top-up limit of *** euros per month, but this can be increased to **,*** euros per month if proof of identity is provided. This is in line with anti-money laundering and anti-terrorist financing regulations.

Prepaid cards operate like traditional bank cards, with functions such as withdrawals, in-store payments and online purchases, without allowing overdraft. They can be linked to a payment account with RIB or be anonymous, and generally do not require proof of income. [***]

Innovation in bankcard design

Bankcard design continues to be an area of innovation. Notable examples include ...

4.4 Fintech: The evolution of prepaid card services

The future of prepaid cards in the context of fintech evolution is marked by several key trends:

Integration with digital technology: Fintechs are transforming prepaid cards by integrating advanced digital functionalities. This includes the increased use of e-wallets and mobile applications to manage funds on prepaid cards. The focus is on ease of use, enhanced security and transaction flexibility. Increased affordability: Thanks to fintechs, prepaid cards are becoming an important tool for financial inclusion. They offer an alternative to traditional bank accounts, particularly for the unbanked or underbanked. Fintechs are using prepaid cards to reach wider market segments, including in developing regions. Personalization and targeted offers: With advances in data analytics and artificial intelligence, fintechs can offer personalized prepaid cards, catering to consumers' specific needs. This includes rewards and loyalty programs tailored to users' spending habits. Increased interactivity with crypto-currencies: Some fintechs are exploring the use of prepaid cards as a means of facilitating cryptocurrency transactions. These cards make it easier for users to spend cryptocurrencies in everyday transactions, acting as a bridge between digital currencies and traditional payment systems. Enhanced security and compliance: In an ever-changing regulatory environment, fintechs are focusing on compliance and security for prepaid cards. This includes ...

5.1 Credit card regulations

Electronic money

Directive ****/**/UC defines electronic money as monetary value stored on a smart card, such as a prepaid card, accepted by institutions other than that of the issuer. The issuer of this smart card is responsible for exchanging cash of equal value for electronic money, and for implementing safeguards against money laundering.

Prepaid" statement on cards

Regulation (***) ****/*** of the European Parliament and of the Council of April **, **** requires since June **** that the category of the bank card be indicated on the cards, there are * categories:

"Credit" or "credit card" for cards issuing credit, deferred debits ; "Debit" for cards with balance control; "Commercial" for business cards; "Prepaid" for prepaid cards.

Strong identification for online payments

The Payment Services Directive, known as PSD*, was passed in **** by the European Parliament and came into force in September ****, and now applies to online purchases from May **, ****, it requires, for example:

The prohibition of overcharging, such as the application of fees when paying by debit or credit card, both in a store and online ; Lowering the deductible to be paid by the customer in the event of fraudulent payment (***). The requirement for strong authentication for online payments over €**, consisting in the identification of at ...

6.1 Market segmentation

• La Banque Postale (La Poste)
• Nickel
• PCS (Creacard)
• Veritas (Prepaid financial services)
• N-26
• Revolut
• Lydia
• Visa
• Mastercard
• Google Pay
• Apple Pay
• Toneo First
• Moni Monisnap