Bluebird prepaid card and The Chase Liquid prepaid cards are targeting teenagers and youngsters by offering a non expensive, convenient system for withdrawals and cash transactions. The prepaid card industry pundits have long believed that companies require a proper segmentation, targeting and positioning of prepaid cash cards. Teenagers are certainly a good segment as parents don’t want to give them access to unlimited amount of money (unlike credit cards) and want to track the spend as well (unlike cash).
Bluebird, a prepaid card initiative by American Express and Walmart was launched in late October 2011, in addition to American express’s digital wallet platform ‘Serve’ . 3 months later in Jan 2013, there were 575,000 customers of Bluebird according to Dan Schulman, Group president of enterprise growth, Amex. 85% of Bluebird customers are new to Amex and 45% of them are estimated to be under the age of 35.
The American express Bluebird is a low cost alternative to the general purpose prepaid card. The bluebird does not charge a monthly fee for activation and can be obtained for $5 at the Walmart stores or for free online. If the cardholder is enrolled in direct deposit, it offers free ATM withdrawals within the MoneyPass network whereas other withdrawals are charged at $2.
The Bluebird can be loaded for free from a bank account or by using cash or debit card at Walmart. Loading with a debit card costs $2. Customers can deposit checks by snapping a picture from their smartphones, electronically pay bills, send cash to family and friends and place upto $100,000 into their accounts. Users can withdraw a maximum of $500 per day and $2000 per month. If a customer wants to send money to someone that does not possess Bluebird, all he has to do is click “Pay Bills” and then add that person as a payee. The receiver’s address and name is required but no social security number or EIN which makes the process simple. The user accumulates 5 chase reward points for every dollar spent which can be redeemed for various goods and services. So there is reward/discount added to a payment instrument. At LTP we have always believed that its a good combination.
Chase Liquid is a reloadable card that can be used at any terminal that accepts VISA® debit cards. It does not charge any fees to open account, load cash, withdraw or reload money onto the card. The Chase Liquid card charges a flat rate of $4.95 a month. There is no charge for getting paper statements or paying bills either. A comparison of annual cost of various cards to the typical user as tabulated by Breton Woods is shown below:
Green Dot Card
Walmart money card
NetSpend Prepaid Premier ($500 + direct deposit)
NetSpend Prepaid (Fee Advantage)
NetSpend Prepaid (Pay as you go)
The prime offering of Chase Liquid is free check and cash deposits and free atm withdrawals. 17,500 ATMs are in operation along with 5,500 branches in 32 states. Chase Liquid does not charge for customer service. The card can be loaded with as little as $25 to begin with.
The American express Bluebird card charges $2 for each ATM withdrawal if the customer does not enroll in direct deposit while the Chase card charges no fee for transactions. There are 80,000 ATMs available for withdrawal for the American express Bluebird in comparison to 17,500 for Chase Liquid. The Bluebird card does not charge any flat rate per month for its card, Chase Liquid charges $4.95.
LTP View: Both prepaid cards have new cost effective options for customers who are economically backward and unbanked/underbanked. While the cost of obtaining and maintenance of a Chase Liquid card might be a little lesser, the sheer number of its ATMs, Walmart outlets (more than 4000) and service offered by the American Express Bluebird card might give it an edge.
Chiraag Patel is a Senior Reporting Analyst and the Editor of Bitcoin and Virtual Currency channels at Lets Talk Payments. He is an engineer with deep interest in MMORPG, Virtual Banking, Game Currency and Virtual Cash. Chiraag enjoys Reading & Blogging with focus on New Innovation, Technology & Startups in the Payments Space.
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