PayPal announced today the launch of its first fully-branded cash loading card, called the PayPal My Cash Card, which will allow users to load up their PayPal accounts using cash instead of bank transfers. The card will be sold at pharmacies and discount stores, including CVS, Rite Aid, Fred’s, Dollar General, Family Dollar, and others soon.
The company says that the PayPal Cash Card will be available beginning today, at 30,000 locations across the U.S., 10,000 of which are Dollar Generals.
To activate a card, users first purchase the dollar amount they want to load. The card is available at launch in fixed amounts like $20, $50, $100 and more. They then log into the PayPal My Cash Card website, and load the funds directly into their PayPal account using the PIN number provided on the back of the card. If they don’t already have a PayPal account, they can create one at this time. After the funds are loaded, users can then use PayPal as usual, with any of the online merchants’ websites where PayPal is supported as one of the checkout options.
To launch the new card, PayPal worked with InComm, a provider of prepaid products, including wireless cards, gift cards, redeemable debit cards, promotional cards, gaming cards, and other stored value cards in the industry.
Serving The “Under-Banked”
With this move, PayPal is expanding its reach to the segment of the market commonly referred to as the “un-banked” or “under-banked.” Though that’s something of a misnomer, as Dave Wilkes, CEO of Fuze Networks recently pointed out to us. His company is working to allow consumers to make bill payments using cash, and he says that who prefer to pay with cash aren’t necessarily “un-banked” (at least, not in the U.S.). The typical prepaid card holder has, on average, 3.2 other cards in his or her wallet, Wilkes told us.
The difference is that this type of consumer tends to prefer using cash to credit or debit, however. That limits the amount of online shopping they’ve been able to do in the past, of course. And, in turn, that limits PayPal’s potential user base.
Walmart, a major retailer with both an online and offline presence, attempted to woo this cash-preferred customer in 2012 as well, by launching a “pay with cash” option in April. Other startups focus on cash as well, like PayNearMe, which lets users shop online and pay with cash, or Dwolla, which has been building out a full cash-based payment network.
But neither PayNearMe nor Dwolla have the brand name recognition of PayPal, and despite Walmart’s size, it is still but one retailer, not a larger network of merchants, like the many merchants offering PayPal support.
This news comes on the heels of other major announcements from PayPal, including the recent report of its biggest mobile shopping day ever, and today, a test of a partnership with gifting startup Wrapp.
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