Several recent announcements underscore the desire of retailers and their partners to focus on the sustainable development of the prepaid card market. Two key themes seemed obvious, focusing on card reuse and using more environmentally friendly materials.
Reuse provides a key message for sustainability while also encouraging cardholders to increase spending, loyalty and rewards.as Sarah Clark Report In NFCW, fashion retailer Zara is working to replace single-use cards with NFC-enabled contactless key fobs. David Maisey, CEO of MultiPay Global Solutions, gave more context to the issue in her report, focusing on the long-term customer experience:
“‘Gift cards provide an important connection between retailers and customers, and like any payment method, there will always be a need for innovation,'” Macy said. It enhances the customer experience and also helps reduce single-use plastic consumption. “
Maisey’s point underscores the findings of Javelin Strategy & Research, which show that across nearly every vertical, loyalty programs increase spending and increase self-use of gift cards. Making gift cards a permanent item on a key chain, and potentially expanding into a fashion accessory, not only sends an important message of sustainability, but also encourages refills, repeat visits and increased spending.
Card vendors are also starting to focus on sustainability and are seeking industry certifications to provide objective recognition for their efforts. CPI Card Group recently reported sales of more than 95 million eco-friendly card products Announce Its Forest Stewardship Council® (FSC®) Chain of Custody (CoC) scheme certification:
“FSC CoC certification ensures that certified wood products are traced from responsibly managed forests to the final paper product, verifying that FSC certified material has been identified or separated from non-certified material throughout the supply chain. Through the certification process, SCS conducted an independent review of CPI’s sustainability efforts and verified its use of responsibly sourced products.”
These efforts go beyond actual production quality and investment, as they receive additional independent approval for their key sustainability efforts. Sustainability and reuse will both be key topics as the industry prepares for the 2023 holiday season and plans to go into production for 2024. To strengthen these efforts, we will continue to gradually move to digital cards, which account for nearly 40% of the market and provide a third leg of sustainability information. Each of these pillars will need to demonstrate the full commitment of suppliers, issuers, retailers, and others in the prepaid space, and meet the growing need for potential regulations, such as the pending California measure (SB 728), aiming to completely eliminate plastic gift cards by the end of 2027.
overview Jordan HirschfeldDirector of Prepaid Advisory Services, Javelin Strategy and Research.