Hispanics are a large demographic in the U.S. According to the 2010 U.S. Census, Hispanics make up approximately 16.3% of the U.S. population, with over 50 Million Hispanics in the U.S. The Hispanic market is an important one for many prepaid debit card issuers, as studies have shown that nearly 20% of Hispanics are unbanked. A recent study by The National Council of La Raza (NCLR)the largest national Hispanic civil rights and advocacy organization in the United States, provides some insight into Hispanic prepaid card users and their preferences.
The La Raza recently published a report titled “Perspectives on Prepaid Cards from Low-Income Hispanic Tax Filers” based on a survey they conducted to better understand the experiences of low-income Hispanic families who have used prepaid cards. 279 surveys were collected between April 1 and April 15, 2010 from families seeking assistance at five Volunteer Income Tax Assistance (VITA) Program sites.
The surveys found that most users were attracted to their prepaid debit card because it seemed convenient. Hispanic and non-Hispanic card users cited convenience as the top reason for getting a card. Latino respondents also indicated that “cheaper than going to a check casher,” “a friend recommended it to me,” and “prefer a card over cash” as primary motivations behind their choice of using a prepaid debit card. All cardholders listed the same top four uses for their cards: to pay bills, make purchases online, shop for household items, and to use as a safety net in case of an emergency.
The La Raza report indicated a notable trend in the surveys – Hispanic prepaid debit card users were far less likely than non-Hispanics to identify ATM cash withdrawals as a top use for their prepaid card (with only 13% of Hispanics vs 41% of non-Hispanics selecting this response). Walmart was the single most popular place to buy a prepaid debit card, although buyers were found to purchase prepaid cards at a wide variety of stores.
Check out the full survey results here.