Prepaid cards in India: Growth, Trends and Future

Raj N – Founder and Chairman of leading FinTech company Zaggle and SME neo-bank ZikZuk writes a detailed article on Prepaid Cards.

CIOL Bureau
New Update
Prepaid cards in India: Growth, Trends and Future

The Indian prepaid card market has witnessed a boom in the recent past and the reason is quite simple. Prepaid cards help simplify overtly complex processes of billings and transactions and also offer control over cash flows. With this context, the business sector is said to be one of the major sectors that are rapidly adapting to the use of prepaid cards. This allows it to process payments quickly and easily and further eliminates time-consuming process which delays reimbursements and offers limited payment flexibility. Additionally, cheques and cash payment issued to employees for various reasons can also be a cause of concern for companies in terms of misappropriation of funds or financial frauds. Hence, corporates and MNCs are steering their way towards the adoption of prepaid card.


As per a study by the Expert Market Research company, the Indian prepaid cards market is expected to grow at a CAGR of a whopping 40.5% between 2021- 2026. Some of the major reasons behind the growth of corporate prepaid cards are as follows:

Better management of cash flows

Employers can have complete control over their spending and they can decide the amount of money to be loaded on the card for employee expenses. Hence, both the employers and the employees are thoroughly aware of the maximum limit and are in total control of their expenses.


Employee reimbursement made easier

Nowadays employees are often required to be on the go; be it be for work-related travel, attending events, seminars and client meetings. This results in high-value bills and other expenses, which need to be settled either in cash or by card. Often employees are reluctant towards initially settling the expenses themselves in place of later payouts. Companies, too, want to avoid the hassle and paperwork associated with reimbursements and bills payments. Therefore, a prepaid card is pretty much the need of the hour for organisations as it not only eliminates unnecessary processes and smoothens financial functioning but also guarantees certain stability, which most businesses look for.

More secure than cheques and cash


It wouldn’t be incorrect to say that carrying cash while travelling, might not be the safest choice. As the probability of cash getting stolen or misplaced is quite high. And when it comes to cheque payments, at times they have lesser acceptability and it is pretty inconvenient to pay for trivial expenses using cheques while travelling. Hence using a corporate prepaid card is far better and way more secure. Besides, if a corporate prepaid card is stolen or lost it can be easily reported and retrieved.

Unhampered credit score

Corporate credit cards are handed to employees by employers. Hence, in no way it can taint an employee’s credit score for any underlying reason. The employees can use their corporate credit card as per their requirements.


The rapid rise and growth of the prepaid sector are also fueled by the various consumer trends and the uses of the prepaid card in the market.

The growth of the prepaid card market can be summarized as per the following categories of uses:

Gift Cards


Gift cards have been a predominant trend in the prepaid cards market. They have successfully bolstered the gifting tradition. Whether using it for online shopping or using it at a retail store, gift cards have continued to remain the most widely circulated prepaid card in the market. That said, e-gift transactions have seen a threefold surge in the recent past.

Meal Cards

A sizeable segment of growth for a prepaid card is meal cards, which has taken the corporate sector by storm. And select companies have started offering such meal cards to their employees for their various uses. These cards can be used in an array of settings such as purchasing snacks and meal at various restaurants, as well as grocery shopping at particular stores. These cards offer convenience thereby making it a win-win for both employees and employers.


Travel Cards

Prepaid travel cards are also being increasingly adopted by the corporate sector. As it makes it easier for employers to load a single currency for employees travelling to one destination. Besides, employers can also load it with multiple currencies if the employees are due to travel to different international destinations.

PayDay Cards


PayDay cards are specifically tailored for gig workers. Gig Workers can now instantly receive their remuneration through these cards on the completion of their work. With the inception of pay-day prepaid cards, gone are those days when temporary workers had to wait for hours long in the queue to receive their payments.

Final Thoughts

To sum up, various trends are ready to penetrate the corporate prepaid cards market. This involves innovative RnR programs, employee tax benefits programs, multi-wallet reloadable prepaid cards option and the likes. Furthermore, it doesn’t seem that such cards, will find it difficult to seek acceptance and use in the market. Businesses these days prefer new age innovative products, that not only allow them to increase their profitability but also offer select incentives to their employees. And that too in the current times of the pandemic when it is crucial to boost employee morale and invigorate their productivity.

Thus, companies, by and large, have realised that the best way to enhance employee productivity is by offering them attractive benefits, rewards and tax advantages. And the quickest way to do so is by providing distinctive offerings through corporate prepaid cards.

Although while thinking of prepaid cards, we only picture the big-league banks such as ICICI, HDFC and Kotak Mahindra to offer such facilities. However, FinTech companies are not behind this race, rather have an advantage compared to traditional banks in the prepaid cards space. Moreover, it is the FinTech companies that are offering such agile and nimble products like the ones mentioned above to the corporates of this generation.