Debit card acceptance crucial as younger consumers own plastic
August 26, 2013

Small and medium-sized businesses continue to see reasons why investing in credit card processing software to accept debit card payments is essential in today's marketplace. With more consumers reaching for plastic at the point of sale, SMBs that are unable to accept credit and debit cards are putting themselves at risk of lower sales. One of the biggest trends hitting payments is the rise of the prepaid card, which more customers are beginning to favor for financial security, the inclusion of customer service and the ability to gain all the benefits of plastic without starting a bank account.

According to Time Magazine, recent surveys found consumers are turning to prepaid cards that have similar services as credit cards to take advantage of the security that comes with plastic without opening a special account. Time reported prepaid cards that provide customer service support and fewer transaction fees are quickly becoming favored by consumers.

In fact, more prepaid cards entering the market are aimed at younger consumers. According to The Kansas City Star, children can now own a card depicting the League of Legends, a popular online video game. Prepaid cards marketed to children offer them the opportunity to learn finance management and how to pay with plastic. According to the source, the prepaid card gives young owners the ability to buy points for the game online, which may teach children how to shop online.

Prepaid cards may influence younger consumer spending
The Kansas City Star reported prepaid cards are quickly gaining consumer favor as an alternative to the traditional banking account, as the users can establish their ideal spending amount. Plastic aimed at younger consumers hold promise as a positive financial learning tool, as children must keep track of their spending and keep fees in mind. With more young consumers owning plastic, SMBs may begin to see cash use decline as more customers grow up feeling comfortable using debit and credit cards.

As the retail environment continues to move toward e-commerce and offering multiple transaction options, younger consumers may begin to expect to be able to choose their preferred payment type at the point of sale. Not investing in electronic payment systems or integrated transaction platforms may result in lower revenue for SMBs. Younger consumers may be more apt to use plastic than their parents, making credit card acceptance crucial for SMBs to stay competitive and drive sales. 

Nexus: G-WEBCD6