The Asian Prepaid Cards Market

Published: February 2012
No. of Pages: 50

  • Coverage includes not only the behemoths of China and India, but also Hong Kong, Vietnam and countries in South East Asia
  • Drivers for success and the regulatory environment are analysed
  • Relevant examples are picked-up and discussed
  • Transit schemes are one of the key uses – Hong Kong, Singapore and Malaysia are dealt with


Cash is the main payment instrument in Asia; yet the use of cards has increased, supported by strong economic growth, the region’s expanding middle class, and government support for initiatives aimed at reducing physical currency transactions. This report aims to provide an overview of the current status of the prepaid cards market, as well as product availability and key features in large economies such as China, India, smaller countries like Indonesia, the Philippines and Malaysia, as well as mature economies such as Hong Kong and Singapore, highlighting opportunities and risks.

China comes across as a mature market with a strong focus on gift cards, but changes in legislation aiming to close legal loopholes may threaten further development. India emerges as the country offering the most opportunities, thanks to an expanding middle class and an already well-established prepaid cards market, mainly focused on payroll and travel cards.
Apart from these two countries, prepaid cards throughout Asia developed primarily as transport cards with added features allowing for micropayment in retail outlets. Prepaid cards are also considered an important means of increasing financial inclusion, providing a payment instrument to people without bank accounts. However, this group is likely to be too high-risk and low-profit for banks, and alternative payment solutions can be delivered by mobile telecom providers, which have already established relations with their clients. Mobile phone penetration is very high in Asia, and the Philippines has one of the most successful of these schemes, set up by Smart Communications. Regulations issued by the central bank having been crucial in supporting its growth. A more regulated e-money market is slowing down development of this instrument in Indonesia, where prepaid cards have developed around the micropayments concept.

A high percentage of the populations of Malaysia, Hong Kong and Singapore have bank accounts. Malaysia is the lowest, at 80%, and demand for multipurpose prepaid cards has remained low and operators have failed to establish a profitable business model. However, transit cards which permit retail payments, such as the Octopus scheme, Touch ’n Go in Malaysia and EZ-Link, as well as the NETs Cashcard in Singapore, have been successful.


  • This VRL report examines the prepaid market in China, India, Indonesia, the Philippines, Malaysia, Singapore and Hong Kong
  • Discover the leading players, product portfolios and business and operating models in the Asian prepaid market
  • Learn of the challenges affecting the prepaid market
  • Gain insight into the market drivers, such as the Indian middle-class, who are driving strong demand for payroll and travel cards

Key Highlights

  • The Asian prepaid market continues to grow, but there is little uniformity of product – the markets are just too different
  • Regulations are another catalyst; it can lead to rapid and profound changes in the operating environment
  • Banks and non-banks (telcos) form the backbone of a multi-stakeholder payment ecosystem
  • Strongest growth will be from transit schemes and government benefit programmes

Reasons To Buy

  • Find out why mobile providers may be the best way forward
  • See a breakdown of the national regulatory environments
  • Read analysis of specific scheme programmes and discover why some succeed where others fail
  • Discover the potential for prepaid in each country
  • Consider the importance of government support

The Asian Prepaid Cards Market

Table of Contents

Executive Summary
List of Figures
List of Tables

1 An introduction to prepaid cards
1.1 Rising number of stakeholders
1.2 Serving the unbanked and…
1.3..the central role of mobile phones
1.4 High potential and high risks
1.5 The future of the Asian prepaid cards market

2 China – towards a more regulated market
2.1 New players attracted by profitability drive prepaid cards
2.2 The development of alternative business models
2.3 Understanding local tradition to open new markets
2.4 Transportation cards are in the second stage of development
2.5 New legislation came into force…
2.6…but brought uncertainty on future developments

3 India – an expanding market supported by relaxed regulation
3.1 Need to develop POS network
3.2 Strong support for cards from Indian institutions
3.3 Prepaid cards are part of enhancing financial inclusion
3.4 Prepaid in India: a high-volume, low-margin business
3.5 Seizing opportunities in the Indian market

4 Indonesia and Philippines – mobile solutions to enhance financial inclusion
4.1 Indonesia – micropayments have increased but more consumer education needed
4.2 Bank Indonesia regulating e-money
4.3 Delivering prepaid solutions through mobile phones
4.4 Replicating the Filipino model: understanding the success drivers
4.5 Prepaid cards offered by banks in the Philippines

5 Hong Kong, Malaysia and Singapore – Transit schemes
5.1 Prepaid cards popular, but transit payment is the primary use
5.2 Interest for prepaid cards outside the leading schemes remains low
5.3 The future of prepaid cards

6 Thailand and Vietnam – Early stage of development
6.1 Early stage but ambitious projects in Thailand
6.2 Low success outside transit schemes
6.3 Positive results from prepaid no-card based solution: TrueMoney

List of Tables

Table 1: Certificates of Authorisation issued to non-banking institutions by the Reserve Bank of India under the Payment and Settlement Systems Act, 2007
Table 2: Prepaid cards offer by banks
Table 3: Prepaid micropayment schemes active in Indonesia
Table 4: Prepaid cards available in the Philippines: type of cards, features and circuits
Table 5: Leading prepaid contactless schemes (Hong Kong, Malaysia and Singapore)
Table 6: Number of cards, volume and value of transactions by leading scheme: Octopus, Touch ’n Go, NETS Cash Card and EZ Link
Table 7: Feature of the EZ-link and FEVO prepaid MasterCard
Table 8: Other issuers of prepaid cards in Hong Kong, Malaysia and Singapore – types of cards, features and circuits
Table 9: List of Prepaid cards issuers in Malaysia by bank and non-bank
Table 10: Issuers of e-money, Thailand, January 2012
Table 11: Prepaid cards issued by banks in Thailand – type of cards, features and circuits

List of Figures

Figure 1: Development of the legal framework for NFPIs set by The People’s Bank of China
Figure 2: Development of draft rules for cardholder registration and cash purchases of prepaid cards
Figure 3: Number of POS in China and India (thousands)
Figure 4: Yearly number of transactions per POS, China and India
Figure 5: Average number of transactions per ATM, China and India
Figure 6: Evolution of the regulatory framework in India by Reserve Bank of India
Figure 7: Prepaid cards in India: Market segmentation by card type, by volume
Figure 8: Number of e-Money in circulation in Indonesia by volume (2007-11)
Figure 9: Number of Flazz cards in circulation by volume (2007-11)
Figure 10: Evolution of the legislative framework on e-money in the Philippines
Figure 11: Remittance market in the Philippines by value ($ billion), 2005-10
Figure 12: Prepaid revenue by source (%), Malaysia

Published By: Timetric
Product Code: Timetric249

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