MasterCard Travel Card Hopes To Replace Cheques, Cash

Not having to worry about exchanging money or travelers checks? Priceless. At least that's what MasterCard is hoping for by launching a pre-paid and reloadable card that travelers can use instead of cash.

The MasterCard Travel Card will be available through Airlines Reporting Corporation, a company that works with more than 20,000 travel agencies around the country on financial settlement and data. The card, which can be loaded with up to $9,500 on its account, will be available at the agencies, with the hopes that people will purchase them when making their travel arrangements.

"Consumers are looking for a travel card product that is all about convenience and peace of mind," Mike Brunner, MasterCard's VP/pre-paid sales and issuer development tells Marketing Daily.

The card will be marketed primarily through ARC's 20,000 member travel agencies, as well as through ARC's airline partners (the company describes itself as "airline-owned") through print and collateral materials. The company has targeted three main audiences for the cards: student travelers, families and international travelers. "As they're booking their trips, they're able to purchase the card," Brunner says. "If they're going to multiple countries they're going to need a way to access money."

In addition to working like a credit card, the Travel Card will also work at more than a million ATMs around the world in MasterCard's network, he says. But unlike a credit card, the Travel Card can be positioned as a way to impose a stricter budget on travel spending, he says.

The card will be enabled with PayPass contactless technology, which allows users to simply pass the card over an enabled reader, rather than pass the magnetic stripe through a machine. The Pay Pass technology, which is available on other MasterCard cards as well, is another layer of convenience for travelers, Brunner says.

Traveler's checks had long been a staple of a tourist's checklist because they offered more protection than carrying cash. Brunner says the checks have fallen out of favor in recent years, and the company estimates the travel card market will grow to $9 billion by 2010.

American Express, however, earlier this year discontinued its Traveler Cheque Card, suggesting that the classic traveler's cheques would suit customer needs. "We have an incredibly loyal customer base on our paper traveler's cheques," company spokesman Robert Sherman tells Marketing Daily. "It's deeply ingrained in the travel plans of our customers. There's an affinity among our customers to using something that's tried and true."

Sherman says American Express sells about $20 billion in pre-paid products every year, with a majority of those sales coming from those checks.

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