Ukash, a United Kingdom-based firm that sells prepaid vouchers for online shopping, is expanding the product’s functionality and giving users the option to transfer unused funds to an account accessible with a MasterCard-branded prepaid debit smart card.
Customers may use the EMV-compliant card to make purchases at MasterCard merchants or to withdraw cash from the account at any Cirrus ATM.
“We very much see ourselves as a digital currency, and customers have always asked us how do we get cash back from Ukash,” David Hunter, Ukash CEO, told PaymentsSource in an interview. “In a way, we’re closing the loop in the e-cash process.”
Ukash vouchers have unique 19-digit codes consumers enter when initiating purchases on merchant websites. Ukash sells the vouchers to consumers who prefer not to use payment cards for online purchases or who cannot use cards. More than 420,000 merchants worldwide accept the vouchers as payment.
Consumers may load the card online using a Ukash voucher. The first load is free at the time of the card’s purchase. Additional loads cost 3% of the amount put on the card. The funds are kept in a prepaid account the card accesses.
The UkashOut MasterCard costs US$15 (£10 or 12 euros) and is delivered in about two business days, Hunter said.
The card helps Ukash address the issue of what happens when a consumer wants to convert digital currency back to cash, Ben Jackson, a senior analyst in the prepaid advisory service at Mercator, told PaymentsSource in an interview.
“Cash is still king among consumers because it’s universal acceptance,” Jackson said. “There is certainly a set of consumers that worries once they put the money online–will they ever be able to get at it again?”
Besides “cashing out” a voucher, Ukash also wanted to give consumers the ability to purchase goods from online retailers that do not accept the company’s vouchers as payment, Hunter said.
“We’re recognizing that our customer base is keen to buying online,” Hunter added. “We didn’t have all the merchants that our customers wanted to buy from.”
The card is available in British pounds, euros or U.S. dollars, and consumers may hold one card per currency, Hunter said. Ukash decided to make the card available in multiple currencies because it believes the product might be used as a travel card, he said.
“We also chose the three most popular currencies with merchants,” Hunter added.
Ukash’s new product comes just three months after it launched a free Apple Inc. iPhone application (
That feature, among other issues, has prohibited Ukash from entering the U.S. because of differences in state funds-transfer laws. Ukash has increased its efforts to enter the U.S. market and hopes to gain entry through a third party by the end of the year, Hunter said.
UkashOut users get charged a monthly $2.50 fee only when not using the card for 30 days, Hunter said.
Cyprus-based CSE PLC issues the card and processes the transactions.
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