Back To Top

Prepaid card use drops sharply due to inconvenience

The use of prepaid cards has dropped sharply in recent years, data showed Monday, as credit card companies have shunned promoting their use due to inconvenience.

Credit card firms have been reluctant to stage marketing campaigns for prepaid cards as such payment methods are burdensome to issuers with little benefits.

(Yonhap)
(Yonhap)

The amount purchased by prepaid cards issued by eight credit card firms declined 22.9 percent to 379.9 billion won ($340.8 million) last year from a year earlier, according to the data by the Financial Supervisory Service.

The amount is the lowest since 2006, when the comparable figure was 296.1 billion won.

It also represents about a quarter of 1.56 trillion won tallied in 2011.

FSS data showed that numbers peaked in 2010, when 1.73 trillion won was paid by such cards, before numbers started dropping gradually in the following years.

The Fair Trade Commission last year revised relevant regulations requiring credit card firms either to donate the small amount of money left over on the prepaid cards to charity organizations or to return it to the card owners. In the past, credit card firms had been allowed to keep the change left untouched on such cards.

"We are reducing our marketing activities for prepaid cards as they have low profitability due to the maintenance costs involved," an industry source said. (Yonhap)

MOST POPULAR
LATEST NEWS
leadersclub
Korea Herald daum
subscribe