Prepaid Cards in Kenya
Prepaid cards in Kenya is the new banking Channel that the banking industry in Kenya and indeed the world is turning towards. Prepaid cards sales and issuance are one of the fastest growing income and deposit taking streams for many financial institutions. After the financial crises in the world in the last few years, many people have found that their credit rating has been adversely affected and cannot qualify for credit cards.
What are prepaid cards in Kenya
They are a type of debit cards. They differ from the usual debit cards in that they are prepaid while a debit card uses the money in your bank account. They are sold or given out mainly by banks and also by some individual stores or shops, especially in the western world. The cards are called prepaid because the amount to be used is predetermined by the cardholder and paid for in advance. This is convenient to the bank because it is able to collect and mobilize funds before it has to pay for the cardholders spend. Prepaid cards may be used as gift cards, salary cards, store cards and travel cards, to name but a few.
Features of prepaid cards in Kenya
A unique feature on some prepaid cards in Kenya is that they do not necessarily have to have a name printed on the cards. As the banking industry in Kenya evolves and the card business moves to a higher level, cards may be sold to customers from supermarkets and through Agency banking agents. They will be sold like the mobile phone top-up cards. They will be availed to all who need them especially as gift options. The prepaid cards in Kenya can be used in stores that accept the credit and debit cards across the globe.
The prepaid cards may be magnetic strip meaning they have to be swiped at a Point of sale machine. The alternative is to have the prepaid cards as chip cards, which means the information is held in a chip. Chip cards may be used on merchants that are not yet Chip because the default for these cards is the magnetic strip.
Prepaid cards may be denominated in local currency or in foreign currency depending on the financial institution that is issuing the cards. The cards may be for local use only or they may be used internationally. The prepaid cards are usually re-loadable. Whenever more money is required on the card, the cardholder deposits more money in his card account.
Banks giving prepaid cards in Kenya
Not many banks in Kenya have started on this business line yet. There are three banks who currently give this service. The banks are Kenya commercial bank, Investment and mortgages bank and Bank of Africa.
As the prepaid cards continue to grow in popularity in most parts of the world, the banking sector in Kenya has to be involved. We should prepare ourselves for the competition that will be witnessed in the financial institutions as they get into the prepaid cards in Kenya.