Closed loop debit cards are those cards that can only be used within a network of merchants or stores. These debit cards are not linked to the ATM or Visa/Mastercard networks known as “open loop debit cards”. Gift cards, Gas cards, Campus cards, Mall cards and other specialty use cards are finding new applications to the constantly expanding closed loop card marketplace in the U.S. and especially, worldwide where traditional closed loop cards have not seen the market penetration we’ve experienced in the U.S. See some examples below:
- DOUBLE-DIGIT GROWTH - Overall, the value of both branded and private-label prepaid cards is expected to grow from $113 Billion this year to $178 Billion by 2010.
- LOYALTY AND REWARDS – A chain of merchants can provide their customers a loyalty and rewards program that allows for customers to earn points redeemable into dollars or gifts based upon the purchases in that particular chain.
- INTERNATIONAL RE-LOADABLE DEBIT CARDS – Debit cards can be issued to individuals in foreign countries that are un-banked to eliminate theft and burglary of cash. These cards can be loaded and used within a national network of stores or government offices.
- GAS CARDS – Gas cards can be issued to transportation drivers and citizens to eliminate carrying cash and receiving discounts or rewards for using specific fuel store chains.
- GIFT CARDS – Non re-loadable gift cards can be issued to customers who desire to shop in a network of stores or geographical area. Those stores will accept those cards and are processed on their existing point of sale terminals, like in a shopping mall.