American Express also Targeting Students
- American Express will propose prepaid campus ID cards for students from the University of North Florida.
- The player carries on expanding its prepaid lineup and opens up to new customer segments. In June 2011, it launched a new “low-cost” prepaid card (and erased all fees related to its online and off-line use – see June 2011 Insight); in March, it launched the reloadable e-wallet Serve (a solution which does not depend on the customer’s card brand or kind of account).
- This new card is to be used on-campus and with off-campus American Express merchants. It does not imply any monthly maintenance or activation fees (as is the case with the card launched in June); current operations (account balance consultation, etc.), alerts and foreign currency conversion are not to be charged either. Cash withdrawals from non-American Express ATMs, for their part, cost two dollars except for the first one in the month.
- The US player again expands the reach of its offers and here targets students to assert their future loyalty as active workers. This students-dedicated solution may then help these young customers move upmarket.
- A study conducted by the US Federal Reserve Bank in April 2011 shows that the number of prepaid cards went from 3.3 billion in 2006 to 6 billion in 2009 (for an overall value of 140 billion dollars). They only account for 5.4% of the transactions, with exception of cash payments, but their number has increased by 21.5% per year (and 23% in values) over the same period. They are generally considered more secure and respond to the specific needs of under-banked and unbanked people in the US (20% of the population according to Federal Deposit Insurance Corporation).