Both businesses and customers are trading in their cash for new payment solutions.
Cash use has declined in recent years due to its inconvenience and transferability of germs. In Canada, 57% of people use cash less often than in prior years, and the prepaid card market in the U.S. is expected to grow 6% each year until 2024. The pandemic has accelerated the adoption of electronic payments, forcing companies to shift their payment strategies.
In comparison, touchless options like prepaid cards and mobile apps provide users with on-demand, flexible solutions they can pay with anywhere. Some businesses have been leveraging these methods in innovative ways, passing on spending freedom to their customers and employees.
HOW BUSINESSES CAN USE PREPAID CARDS INSTEAD OF CASH
Restaurant Tips
Cash tips were popular in the past, but tracking and distributing them is tedious. Not to mention, handling physical currency can become a security risk. With new prepaid methods, servers receive tips each night on their prepaid card that they can spend anywhere—online or in-store. Servers benefit from convenience while restaurant owners enjoy a secure, seamless method of transmitting payments. Prepaid’s a win-win.
Local Business Incentives
The tourism industry was one of the hardest hit by the pandemic, with small business owners being no exception. Many regions across Canada have struggled to recover, but some have developed creative ways to revive their local economy.
One organization that leveraged digital payments was the Fort McMurray Chamber of Commerce in Alberta, Canada. In partnership with local hotels, they launched an incentive program that offered visitors a Visa prepaid gift card to spend at shops and restaurants within the city limits.
“Sustainable economic recovery needs to include collective steps taken by all of us to shop local whenever we can. The prepaid gift card program helps streamline the buying decision by offering a distinct value proposition for the consumer.”
— Dianna de Sousa, Executive Director of Fort McMurray Chamber of Commerce
Value-added incentives like digital gift cards connect all stakeholders within the tourism industry, including hotels, restaurants, storefronts, and nearby attractions. These programs encourage visitors to see or do more during their stay, making their trip more memorable and motivating return visits.
Virtual Meetings and Events
Multiple surveys have shown that employees prefer a hybrid work arrangement between remote and in-office days.
The Business Development Bank of Canada found that almost three-quarters of businesses plan to offer remote work options after the pandemic because 55% of employees surveyed want to continue working remotely. Additionally, Statistics Canada reported that 80% of teleworkers prefer half of their working hours be at home, showing remote work is here to stay.
From startups to large corporations, businesses of all sizes have remained flexible with meeting technologies like Zoom and Microsoft Teams. However, fatigue from constant virtual work is a real concern. Companies that continue work from home policies once the pandemic subsides can provide employee incentives to mitigate this risk. Open-loop incentives can encourage people to attend training sessions, online luncheons, town halls, or webinars, all with secure transactions.
University Per Diem Payments
Universities are also taking note. While many institutions still rely on outdated payment processes for athletics, financial aid or reimbursements, open-loop payments are gradually replacing cash.
Since all transactions are trackable and digitally accessible on cards, university departments benefit from cost savings within reconciliation and budgeting. Providing funds on loadable cards also promotes financial literacy and accountability among student cardholders who have the chance to track their spending.
Employee Recognition
Rewarding your employees for outstanding work has never been easier with prepaid cards. Unlike cheques, which can take several days to process, cards offer instant disbursements and buying power. Gift cards can also be programmed as open-loop or closed-loop systems, enabling them to be used where Visa is accepted or limited to a geographic area or industry.
Client Disbursement
Businesses are increasingly using prepaid cards to reimburse customers because of their convenience and marketing benefits. They allow employers to avoid high cheque fees and capitalize on free advertising with card art. By embossing custom cards with your logo and messaging, your clients are reminded of your brand every time they make a purchase. Your one-time investment helps build client loyalty, which is worth much more.
Loyalty Rewards
Lastly, prepaid cards are an exciting frontier for loyalty rewards programs. More traditional reward methods involve collecting points, which can be inconvenient due to their limited spending options. Prepaid, however, gives customers spending freedom with real funds.
At Tru, our card programs also offer customer behaviour analytics, giving your marketing and sales team the gateway to making data-driven strategies. Cards can even be offered in a virtual format, eliminating the need for a physical card and making the distribution as easy as sending an email.
Tru offers unique loyalty & rewards program, with unmatched data tracking and reporting. Contact our award-winning team if you would like more information on implementing your own program.