Netspend has launched a Visa-branded prepaid card that enables cardholders to earn miles good for travel through United Airlines’ MileagePlus loyalty program. The product addresses one of the main issues facing prepaid providers—long-term cardholder retention.
TSYS-owned Netspend said the MileagePlus GO Visa Prepaid Card will be available to consumers this summer. “We are eager to offer the opportunity to earn airline miles to consumers who are looking for new financial solutions to help them manage their money,” said Chuck Harris, Netspend president. “Several of our prepaid cards offer a loyalty component, but no other prepaid card in the U.S. offers the ability to directly earn miles through a major airline.”
Consumers can order the new cards by using active MileagePlus account numbers. Republic Bank will issue the cards.
The fall 2016 issue of Pay Magazine looked in-depth at the topic of “Powering Prepaid Loyalty.” Among the ways prepaid providers are striving to increase that loyalty is cash rewards. For instance, American Express launched a version of its Pay Award-winning Serve GPR card that offered 1 percent cash back on all purchases. After that program was announced, Walmart said it would add cash rewards to its MoneyCard prepaid program, issued and managed by Green Dot.
Such rewards certainly work for credit cards. Merchant-funded rewards drove $4.7 billion in U.S. credit card purchases in 2014, a figure expected to increase at a 20 percent annual growth rate through 2020, according to Mercator Advisory Group. But it remains unclear how well they will work in prepaid.
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Image Credits: Itzik Gur