Chase Bank Kenya prepaid cards

The bank is known for its relationship banking. it has scooped many banking industry in Kenya awards in past years. Chase Bank has fifteen branches in Kenya.

Chase bank launched it suite of prepaid cards on the 24th of October 2011. The bank had full page advertisements for these products in both the Nation newspaper and the standard newspaper.

Chase Bank Kenya prepaid cards that were launched are:

Zawadi Chase Bank Kenya prepaid cards

Zawadi meaning gift, is an apt description of how the cards will be sold. These cards can be given to people as gifts. They offer good gifts as the person receiving the gift of the card can purchase what they want.

 Incentive Chase Bank Kenya prepaid cards

These cards may be given as incentives to staff who have performed well in their jobs. these cards could replace the cash bonus that are given to staff at the end of each month.

Traveller Chase Bank Kenya prepaid cards

These category of prepaid cards is targeted for people who travel alot. The account holders can purchase the card either in Kenya shillings or dollar denominated cards. the cards can be used over the Internet.

Chase bank Kenya prepaid cards are MasterCard branded. chase bank is the first bank to offer the MasterCard Chase prepaid cards in Kenya. other banks that offer prepaid cards are Visa branded. These banks are Kenya commercial bank, I and M bank and Bank of Africa.

Advantages of Chase Bank Kenya prepaid cards

• one does not have to be an account holder to purchase a chase prepaid card
• the cards can be purchases on Kenya shillings or dollars
• the cards are MasterCard branded cards so have a wide acceptability
• the cash or funds are held in the card not a bank account, so the risk affects funds only held in the card not a bank account
• they can be used in many outlets both in Kenya and the rest of the world, that accept MasterCard cards

Chase Bank has joined the world in availing customers with prepaid cards. Prepaid cards have become popular especially after the economic crisis in the western world from the year 2008. Credit rating for many people especially in America was affected and so they cannot qualify for credit cards, and prepaid cards is the solution.

Chase Bank Kenya prepaid cards have been introduced into the market at the right time when the growth is expected to double in the next two years.

Types of debit cards

Proprietary debit cards

what are debit cards

Debit cards given by a bank to access just that banks accounts and are known as proprietary card. The cards are sometimes also called ATM cards since they are used just at the banks ATMs. Is the bank has merchants or outlets where they have connected their systems, then these ATM cards can be used to access those merchants. In some instances the banks come together and form a common network of ATMs especially. After membership, the proprietary cards from various banks can be used in these common outlets. Charges are agreed amongst the members.

Co-branded debit cards

When a bank works with another company and they come up with a card that would suit both the institutions members and customers, these are known as co-branded or affiliate cards. The cards may be proprietary or they may be association debit cards. Co-branding is usually done with hotels, clubs, malls and airlines. Both institutions work together to give their customers more convenience and to grow their customer base. Both institutions gain from the partnership.

Association debit cards

Banks may sign up with associations like mastercard and visa to give out their branded cards. The association debit cards are widely used globally. The networks for associations are very well networked and use modern and sophisticated technology to ensure cards so branded are acceptable and create convenience for the financial institutions and their customers. There are stringent rules and regulations for those financial institutions wanting to join associations. Joining fees, annual fees and transactions are some of the charges levied by members. The associations have rules not just for joining, but after joining there are rules of engagement between the associations and other members.

Prepaid debit cards

The prepaid debit cards are used by financial institutions to collect funds before the funds are used. Unlike many other cards, the prepaid cards are paid for before the money is used. There are many kinds of prepaid cards like: gift cards, travel cards, store cards, and payroll cards. The prepaid cards are used as a way to control funds and help in financial management.

The choice of which debit cards financial institution or potential cardholder should get depends on which card is most convenient for them.

What is a prepaid card

prepaid card

A Prepaid card is a card that mostly works like a credit card or a debit card but it has to bee preloaded with money for the cardholder to spend. The card can be used in outlets that credit and debit cards are used.

Prepaid card advantages

• A prepaid card uses money that is loaded. This means it will not lead you to get into debt. Prepaid card can help manage your finances and the amounts loaded will be what is available for use.
• It does not matter whether you have a bank account or not, the applicant can access the prepaid cards when they purchase the cards. This card may be used to reach the unbanked masses in many countries.
• The prepaid card can be given to your children or wife while they travel. The card can be reloaded online for whatever amount is required as per the guidelines of the card company.
• Prepaid cards are faster to get since there is no credit check done.
• The prepaid cards are used to improve credit rating but the cardholder or the card company must give this account to the card reference bureau.
• The cardholder is able to load just what they require especially where they are suspicious of online fraud. Once the funds are depleted, the cardholder waits for the next time when they want to shop and then they load just what they require. This card is not linked to a current or savings account, so if a card is stolen, the money in the bank account is not touched and is safe.

Prepaid card disadvantages

• The prepaid cards have many charges that eat away at the available spending amount. Some companies have hidden charges and after the card has been used at a point of sale or ATM, a charge is debited directly in the cardholders account. Ensure to understand all the costs that are associated with the prepaid card that you get
• There is no cash back guarantee like for credit cards. When a prepaid card is used online, and the goods are not delivered or are damaged, some prepaid card companies do not insist that the cardholder get their money back.
• For those customers who do not like to go online, the prepaid card is seen as a problem since the cardholder is expected to get their balance online. They may be embarrassed if the transaction fails due to lack of funds.

A  cardholder has to be aware of prepaid card advantages and disadvantages of the product they have signed up for.

card payment schemes

The main business carried out by card payment schemes is processing of card transactions between acquiring banks and the issuing banks. A list of the card payment schemes below, showing links to the NYSE:

MasterCard Worldwide (NYSE: MA) card payment schemes

This is a multinational company from America.  Since 2006, mastercard has been listed and publically traded, meaning anyone can invest in Mastercard shares.

Visa Inc.( NYSE: V) card payment schemes

Visa is also an American global corporate. The head quarters are in San Francisco, California. Visa is also listed in the NYSE, though this is a recent listed. Visa has operated since 1966 when it was founded.

Japan Credit Bureau (JCB) card payment schemes

This company was founded in 1961 and in 1968 it bought Osaka credit bureau. The purchase made the card get dominance over the credit card market in Japan. JCB co. Limited is its English name. JCB issues cards in twenty countries

American Express Company (NYSE: AXP), card payment schemes

AmEx is another name for American express company. This company was founded in 1850 with head quarters in New York. It forms one of the thirty components for the dow Jones industrial average. It is a global financial services firm. The AmEx charge cards, credit cards and travelers’ cheques have made this payment scheme very well known.

The company has a mascot which was adopted in 1958. This is the image of a centurion or a roman gladiator which appears on their travelers’ cheques and charge cards. AmEx has strategy to have their customers spend in large volumes which have paid off.

China unionpay card payment schemes

CUP is also referred to as Union pay, is a chiness card. It was founded in 2002 March. It is an approved card scheme by the central bank of China – people’s bank of china.  It is the only domestic bank card organization. China Union Pay acts as interbank network for China but Macau and Hong Kong. This card scheme also links ATMs for major banks and smaller banks. Funds transfer and point of sale are part of the network.

Both mastercard and Visa provide banks and financial institutions with branded payment products which are used for ATM, prepaid, credit and debit cards for customers.  Mastercard and Visa do not issue or Acquire cards so they do not extend credit or even set the fees and rates financial institution offer their customer.

China unionpay is one of the card payment schemes with potential to compete with the American Associations.

When you use your card, the card business model comes into play,( whether it is a debit, credit or prepaid card,) a merchant discount is paid to the card company. A merchant is where the Point of sale device has been placed by the card company. The merchant commission is paid for the convenience of not having to deal with cash and the risks associated with cash.

card business model

The fee is split among three parties which make up the card business model

Card business model -Acquiring Bank

An acquiring bank is the bank that processes transactions when a card is used. The acquiring bank also credits the merchant’s account for the amounts spent by card owners less the commissions and fees. The acquiring bank is responsible for negotiating eh commissions with their merchants.

Card business model –issuing bank

Issuing bank is the bank that gives the card to the cardholder. The bank is responsible to settle all their cardholder bills either by debiting the cardholders account or taking cash payments from the cardholders. The issuing bank also gets to share on the merchant commission and this income is known as interchange fees.

Card business model – network connectivity

Network connectivity is the links that are used to connect issuers and acquirers. The banks do not have direct relationship with each other but rather they share a network. This allows a transaction from a card issued in Kenya to be accepted and used in a Tanzanian shop. The two largest networks in the work are Mastercard and Visa.

Typically the average merchant discount is approximately 3% of the purchase price. The amount is divided among the three players, issuers, acquirers and network

ATM usage fees for card business model

Whenever you use an ATM a fee is charged for the transaction. The fee charged is share between the Acquirer of the ATM (owner), the Network and the card issuer, just like the usage of cards at Point of Sale. Some concessions may be given to cardholders who use their banks ATM or the fess are less than when another banks ATM is used.

The major credit cards are mastercard, visa and JCB. The major debit cards are mastercard, maestro and Visa electron. American express and diners club are major charge cards. China union pay and discover are major regional cards.all these have a card business model in place to be successful.

prepaid cards for kids in Kenya

Prepaid cards for kids in kenya

The cards are purchased by the parents for the children who are eighteen years and less. These children do not have contractual rights. The children get the cards and they do not have to keep asking their parents for pocket money. The parent’s credit money into these cards and when the money is used up, the cards cannot be used until they are reloaded.

The children are able to learn how to control finances. The parents could reload the cards on a monthly basis which may be seen as a salary for the children. The children then have to budget and prioritize their spending since they know that the cards will not be reloaded until the month is over.

The children may also learn how to save and maintain children bank accounts from the money they save on their cards on a monthly basis. The money can either be left in the card account as savings or that may be transferred to savings accounts.

Advantages of prepaid cards for Kids in kenya

• One of the major advantages of prepaid cards for kids is that the kids become somewhat independent and they make their own financial decisions. The children feel that they are being treated with respect and like grown-ups. The children especially teenagers value the feeling of freedom.
• The parents are able to keep tract of the spending of their children. The prepaid cards for kids have statements which are either paper based or accessed on the internet. Parents are able to council their children especially if they are deviant on the use of their cards.
• The kids do not have to ask for pocket money on a daily basis or even weekly, because the cards are loaded with funds for a month or more.

The disadvantages of prepaid cards for kids in kenya

• The children may refuse or reduce the use of their prepaid cards because they feel that the parents are spying on them and their friends
• The children may get used to use of cards and become hooked and later on in life they may have challenges with their finances. The children have to be trained on the proper use of cards and the cash in the cards.
• Kids may become targeted by bullies and fraudsters because they have the prepaid cards for kids who have funds loaded on the cards. Theft and robbery in schools may increase especially where the cards do not have the kids’ names on the cards.
• There are charges that are loaded to the prepaid cards for kids. These charges are debited to the cards, reducing the amounts available to the kids. The kids may prefer to get cash instead.

All in all, prepaid cards for kids in Kenya is the way to go. The advantages outweigh the disadvantages. The kids can be trained on how to handle the prepaid cards for kids in kenya that they carry to minimize fraud and losses.

What are Prepaid cards in Kenya

Prepaid Cards in Kenya

Prepaid card is a debit card that is loaded with funds before the funds are required. The money is not debited from your bank account but from the funds that are held in the card account that has been made available by you.

After the financial crisis in the world, in 2008 and years following, the prepaid cards are being used more as a way to manage personal finances. Many previous credit card holders had their credit scores and ratings affected when they were unable or missed to pay for their credit cards or loans. Though these former credit card holders have repaid their loans, their scores are still low. The prepaid cards are able to assist many people who cannot meet the required scores to get other cards and are able to access the convenience of plastic money.

Prepaid cards in kenya as a personal financial management tool

Many people have a problem trying to live within their means. Prepaid cards in Kenya are being used as a way for managing financial challenges. The prepaid card holder loads the card with the amount they require for the month and this is all the money they will use. The card is reloaded monthly and so the cardholder cannot spend what they have not preloaded or planned to use.

The card issued determines the minimum and maximum amounts that cardholders can load to their prepaid cards at any one time. The cardholder determines what they will require for the month an they load this amount. The prepaid card will allow the holder to access the same outlets that they would if they had a credit card or a debit card.

The prepaid cards are used more and more by many people throughout the world. Cardholders can plan for an activity and save for the expense that is required. When the savings are reached, the cardholder can purchase a prepaid card for the amount saved. This is especially good for holidays and leisure activities that can be planned for without using monies put aside for other necessary expenses.

Though prepaid cards have been in use in the western world, they are still new in the Kenyan market. The cards will assist Kenyans plan their expenses better and manage their finances especially in this hard economic times. Prepaid cards in Kenya should be a card that all Kenyan should use to manage their finances.