Nomad provides open-loop prepaid card for IDT

Nomad, Europe's leading prepaid card processor, has worked with IDT to launch the Prime Card, the UK's first fully functional instant-issue prepaid card in conjunction with MasterCard.

The IDT Prime Card, launched via its wholly owned bank, IDT Financial Services, is the UK's first instant issue prepaid MasterCard that can be purchased over the counter with no identification or bank account.

The Prime Card was launched on a trial basis (West London and Slough) late in 2006 and will be available nationwide in early 2007.

The Prime Card is accepted by almost 25 million retailers worldwide, wherever the MasterCard acceptance mark is displayed.

Aimed primarily at the four million people in the UK who do not have access to a bank account, the Prime Card allows them to have the benefits of plastic without the exposure to debt.

Nomad, a MasterCard-approved processor, began working on the Prime Card project with IDT in February 2006.

The company was chosen ahead of a number of suppliers by IDT because of its history in the payments processing market where it has worked with some of the most prestigious financial institutions in the world and because of its success on a number of high-profile projects in the relatively new prepaid sector.

Max Balfour, EVP strategic business development at Nomad, said: "IDT required Nomad to provide processing services on this multi-faceted project having just established a bank in Gibralter.

"This enabled them to become MasterCard members and we were tasked with integrating the company's existing technology with the Nomad CORTEX processing solution to deliver a prepaid technology platform." IDT sells hundreds of millions of prepaid calling cards per year and processes millions of transactions itself every day on its existing platform However, integrating this technology with the processing ability of Nomad was straightforward thanks to the flexibility and scalability of the NPS solution.

Nomad can offer a single solution to those looking to enter the prepaid market, as John Lees, VP sales at Nomad Software said: "During the last 12 months it has become clear that the role of payments processor has extended beyond the provision of a scalable, flexible and cost-effective payments platform.

"The payments processor is often the facilitator of introductions and connections to key partners such as bin sponsors, card schemes and card and PIN production companies.

"This level of support is particularly needed in new markets where experience and good quality advice can be hard to find." On the Prime Card project, IDT took Nomad's full core offering which includes: authorisation; card management; account management; clearing and settlement; web service API; call centre application; card production; PIN production; extracts and reporting; management information.

As well as the way in which it opens up the benefits associated with credit cards to customers the Prime Card is also remarkable because it is one of the first prepaid cards that exploits open-loop technology.

Open-loop technology simply means that the Prime Card can be used wherever the MasterCard acceptance mark is shown, as opposed to a Gift Card which can only be spent with the specific retailer or shopping centre (known as closed loop).

Open-loop technology clearly defines Nomad and IDT as among the first to be fully capable of exploiting the enormous potential of open-loop prepaid cards.

A recent report from leading consultancy Mercator Advisory Group found that that total spending across all open network prepaid segments in 2005 was $14.1 billion, a massive $10 billion increase on 2004.

Plus, according to other research, the open prepaid market is set to grow at 32% per annum reaching a total in 2009 of over $43 billion.

The report said that financial institutions should pay close attention to the increasing adoption of merchant retail locations as a place where consumers acquire their open system prepaid cards, since it creates an important new channel.

With the IDT Prime Card due to be rolled out nationwide and with many other projects in the pipeline it is a very exciting time for IDT and Nomad as they continue to develop their offering in the prepaid market.

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