Closed-Loop Prepaid Cards: What Sets Them Apart

  What are prepaid cards? In the history of payment methods, nestled between the credit card boom of the mid-20th century and the current wave of payments digitalization, there was a different trend that emerged in the 1990s: the prepaid card. First appearing in the ‘70s, closed-loop prepaid gift cards are issued by a business and represent a liability. Funds from these gift cards are kept by the business and can be spent to sustain its operations. Cardholders can only spend up to the amount of money loaded in advance onto the card, hence the term “prepaid.” More recently, businesses have [...]