LAS VEGAS -- In the shadow of the world's most famous gambling strip, an estimated 2,200 bankers, processors, acquirers, aggregators and retailers met for the annual Prepaid Card Expo, betting on innovation in areas such as cell-phone payment and vigilance against state and federal regulation to keep the segment on its current growth track.
Held this month at the Rio Hotel and Casino, the three-day tradeshow and conference featured dozens of workshops and general-session speakers, including Jane Thompson, head of financial services for Bentonville, Ark.-based Wal-Mart, as well as numerous [image-nocss] other executives from banking, processing and card-issuing firms.
Thompson updated session attendees on the progress of its financial-services plans and the expansion of Wal-Mart's so-called "MoneyCenters," dedicated areas set up in stores to serve people who do not have traditional banking relationships.
At the end of 2007, Wal-Mart had 429 locations set up and is on track to open about 15 additional sites per week. Its stated goal has been to have 1,000 up and running by the end of this year.
"We only put them where we knew the customer was," Thompson said. "We're also investing in best practices and recruiting [staff] from the banking industry."
In the area of prepaid innovation, several conference speakers addressed the emerging trend of mobile payment or the use of cell phones as a way for customers to pay for goods. Paul Sutton, president and CEO of Kabria, San Mateo, Calif., told workshop attendees that in Europe, text-messaging is an extremely popular way for people to access their accounts.
"The prevalence of [personal computers] in the U.S. veered us to doing online banking with our PC's," Sutton said. "But in France, for instance, the most frequently sent text message is, 'What's my balance?'"
Another panelist, Amir Wain, CEO of i2c Inc., Redwood Shores, Calif., said near-frequency communications (NFC), the radio-frequency technology used in contactless-payment programs such as the one used by Houston-based ExxonMobil, is a viable alternative for cell-phone payment.
"It will start with more handsets that support NFC," he said. "It's something the consumer will drive."
Other sessions at the conference focused on government regulation and the potential for fraud. "Prepaid is a payment instrument," said Deborah Thoren-Peden, a partner at Pillsbury, Winthrop, Shaw and Pittman in Houston. "It is going to be tested by the criminal level."
She mentioned a case in Las Vegas where thieves sat in a hotel room with credit-card processing equipment and spent days generating refunds. Once the money was deposited into a bank, the group would buy money orders, travelers' checks and prepaid products.
Thoren-Peden and members on her panel discussed the various state and federal regulations designed with consumer protection in mind, but that at the state level, everything from fee charging to expiration-date rules vary.
Keith Kirkpatrick, executive director for the Prepaid Card Expo, New York, told CSP Daily News that each year participation gets stronger, with the 2008 tradeshow floor having more than 150 exhibitors. This year, product innovation and "vigilance" regarding state and federal regulation were strong themes. Next year, the conference and trade show will be held in Orlando, Fla.Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.