Even though prepaid cards are already widely considered a product for the underbanked, usage patterns are showing more clearly just how different prepaid card users are from bank customers.

"At NetSpend, we actually see 40% of our … loads occur outside of traditional banking hours," says Michael Gray, vice president of operations at NetSpend, during an April 8 panel discussion at SourceMedia's 25th annual Card Forum & Expo in Boca Raton, Fla.

Similarly, Gray says he considers the distribution of prepaid cards in nonbank retail stores to be one key to prepaid cards' mainstream success.

"The prepaid consumer is different from a credit card consumer or traditional DDA (demand deposit account) consumer," he says.

Rather than adhere to branch hours, prepaid card users favor alternative channels to manage their accounts. NetSpend sends millions of wireless alerts to tell customers when their payroll has been deposited, and 60% of customers use a smartphone for account access, Gray says.

Since prepaid card users don't carry checks, NetSpend must also provide alternate ways for its customers to pay their bills, he says. NetSpend also offers voice support for consumers who prefer to call a human being, he says. The processor Total System Services Inc. is buying NetSpend in a $1.4 billion all-cash deal.

Matt Kerr, director of strategy and business development at H&R Block, spotlighted partner Plastyc for taking a different approach to serving prepaid card users. At the beginning of the year, H&R Block integrated the Powered by Plastyc technology with its Emerald Online prepaid MasterCard product.

Plastyc offers an "Apple-like experience online," Kerr says. Plastyc allows consumers to establish long-term savings without having to open a separate savings account.

"The whole concept of a prepaid card is, you're in control," he says. The prepaid market continues to see "creative and innovative ways to simplify money management."

Douglas Miraglia, president of MoneyPass Network at Elan Financial Services, notes that prepaid card users still prefer bank settings for one purpose: ATM withdrawals. Though MoneyPass has half of its ATMs within bank branches and half at retail stores, most transactions take place at bank ATMs, he says.

The number of prepaid card products has exploded over the past several years, reiterated by the influx of themed and celebrity-endorsed prepaid cards. Kim Kardashian, Russell Simmons and Suze Orman are note-worthy stars – not all for their success – that have created or endorsed prepaid products. Basketball star Magic Johnson has endorsed two separate cards since 2004.

Recently, teen heartthrob Justin Bieber began promoting the SpendSmart prepaid card, which enables parents to control their teens' spending.

"The tipping point probably came about three to four years ago … with the proliferation of the number of card products," Miraglia says.

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