The 2020 year was a crucial year for the financial industry. The pandemic fueled this sector becoming sort of a trampoline that accelerated the transition from traditional to innovative methods.
The payment industry is going through the filter of Innovations and previously traditional tools get more technologically advanced and customer-oriented. The payment industry itself has been incredibly dynamic for the last years and hardly any other industry experienced such growth.
While the small business world may still heavily rely on outdated payment systems such as cheques - prepaid payments, virtual cards, and other alternative payments are quickly gaining popularity. Card payments allow for greater flexibility, stronger business relationships with suppliers, and the ability to spend more time and energy fine-tuning your company’s strategic approach.
The pandemic has changed the approach to the whole expense regulation system and forced small businesses to rethink employee spendings in a more efficient way. One of these ways can be considered prepaid cards and Prepaid Card Programs, in particular.
Prepaid cards Programs are often overlooked by businesses whereas they present a flexible and comprehensive tool to control business payments and expenses and play an important role in the finances of banked and unbanked consumers and businesses.
Better payroll and spending regulation
A complicated and outdated payroll management system that relied primarily on paper checks has become history and nowadays the convenience and agility provided by prepaid cards is certainly the main factor why most businesses refer to them for payroll payments. The Prepaid Card Programs streamline payroll administration. Prepaid cards help managers, accountants - in general, business administration - to control, monitor instantaneous payroll payments, gaining more compliance, cost-effectiveness, and greater payroll management. Companies can use the cards to manage and track employee expense accounts, for example, travel expenses, enabling companies to cost-effective overspendings prevention.
Opportunities for unbanked businesses
Despite the common digitalization and advancement in technologies, there are still unbanked zones with over a thousand households and people all over the world who have no formal relationship with the banking system. The reasons can be obviously different, whether be it the dissatisfaction with bank proposals and reluctance to enter confused and tangled banking bureaucracy, or it can be the difficulties to access banking services because of rural specifications. Payment networks such as Mastercard, for example, set up programs to provide the vulnerable locals with a prepaid card to enable their access to digital and electronic tools to receive funds.
Prepaid card programs are more flexible and easy-to-handle tools to achieve greater productivity and to handle payments for small local businesses. No need for a bank account, for complicated paperwork. As COVID-19 has expedited the transition to a cashless world, prepaid cards will become more important than ever to help the unbanked. For example, some government programs will use a prepaid card for recurring transactions, such as unemployment benefits and food assistance. Employers can also issue prepaid cards instead of paper checks or direct deposits in order to distribute paychecks or pension funds in times of lockdown.
Enhanced customer experience
Prepaid card programs usually aim to increase engagement across all channels, whether it is the employee’s payroll or customer benefits. In general prepaid cards open up opportunities for businesses in brand awareness enabling them to produce branded cards with a specific design to impress customers. The bonuses and reward programs also increase usability and maximize customer and employee satisfaction.
In conclusion, it should be marked out that now even businesses that have banking relationships are using prepaid cards in increasingly creative ways to streamline operations, cut costs, and support promotional efforts. That’s if businesses are looking for a more secure alternative to cash funds and corporate credit cards they should refer to Prepaid Cards Programs.