According to PayNXT360’s Q2 2021 Global Prepaid Card Survey, prepaid card market in the Australia is expected to grow by 12.7% on annual basis to reach US$ 22,325.7 million in 2021.The prepaid card market expected to grow over the forecast period, recording a CAGR of 11.1% during 2021-2025. The prepaid card market in Australia will increase from US$ 19,808.7 million in 2020 to reach US$ 30,219.1 million by 2025.

    The presence of global and homegrown companies makes the Australian prepaid card market more competitive. However, fintech startups are finding new ways to manage the intense competition and expand their reach. Therefore, the market noticed product innovation and new product launches in the last couple of years. Fintech companies are also involving in mergers and acquisitions to expand their market share in the prepaid card segment.

    The coronavirus pandemic not only caused human lives but affected the country’s economy at large. Nationwide lockdown hampered many industries’ day-to-day operations and increased the unemployment rate significantly. Additionally, Australians experienced increased healthcare expenses during this period. Healthcare companies introduced gift cards to support family and friends.

    Rising market opportunities are attracting foreign fintech players:

    The strong market growth of the Australian prepaid card segment is attracting foreign companies to set up their business in the country. Increased demand and favorable government policy are the key factors attracting overseas players to the country’s prepaid card market. For instance,
    • In June 2021, Marqeta, a US-based fintech company, built a partnership with Novatti. According to the company, the partnership will allow to launch its prepaid card business in Australia. Marqeta is considered to be the first open-API payment platform, and Novatti is a key player in the Australian payment industry.

    Innovation in the prepaid card segment is expected to drive market growth:

    With the rising competition in the prepaid card category, the companies are focusing on product innovation to separate their services. The market has recorded several product launches in recent years. Moreover, the challenges from other payment options such as buy now, pay later are creating the need for innovation in the prepaid card segment. For instance,
    • Revolut Junior Prepaid Card: In August 2020, Revolut, a UK-based fintech firm, launched its service in Australia. With its launch, the company started offering core financial services in the country. However, to expand its target market and product offering, the company launched its Revolut Junior accounts for teens (7 to 17 years) in November 2020.