Dublin, Feb. 27, 2026 (GLOBE NEWSWIRE) — The “United Kingdom Prepaid Card and Digital Wallet Market Intelligence and Future Growth Dynamics Databook – Q1 2026 Update” report has been added to ResearchAndMarkets.com’s offering.
The United Kingdom prepaid card and digital wallet market is expected to grow by 10.3% on annual basis to reach US$59.83 billion in 2026. The prepaid card and digital wallet market in the country has experienced robust growth during 2021-2025, achieving a CAGR of 14.6%. This upward trajectory is expected to continue, with the market forecast to grow at a CAGR of 8.4% during 2026-2030. By the end of 2030, the prepaid card and digital wallet market is projected to expand from its 2025 value of USD 54.26 billion to approximately USD 82.73 billion.
The UK prepaid competitive set spans consumer prepaid account providers, programme managers/BIN sponsors enabling brands and fintechs, processors/issuers providing infrastructure, and specialist providers serving public-sector and disbursement use cases. The main competitive pressure points over the last 12 months are: higher safeguarding expectations (FCA), economics scrutiny for certain cross-border card flows (PSR), and operational readiness for the FCA’s contactless limit changes from March 2026.
The UK prepaid card landscape is being shaped less by “standalone prepaid plastic” and more by how prepaid credentials sit inside a contactless-first payments environment and a higher regulatory baseline for safeguarding customer funds. UK Finance data shows contactless is embedded in everyday payments, and this changes what “good” prepaid looks like: tokenisation readiness, transaction controls, and operational resilience matter as much as distribution.
Current Market Dynamics
- UK contactless behaviour sets a high baseline for prepaid usability: contactless accounts for the majority of UK card transactions in UK Finance reporting, which pushes prepaid offerings to be wallet-ready and POS-reliable.
- FCA reforms are creating barriers: the safeguarding direction in PS25/12 increases operational requirements for payment/e-money firms that hold customer funds, affecting prepaid programmes across consumer and B2B2C models.
Key Players and New Entrants
- Consumer prepaid account providers: UK-facing prepaid propositions include Pockit (a prepaid Mastercard designed for fast onboarding and wallet use) and Suits Me (an e-money account and card positioned as a banking alternative).
- Public-sector/disbursement specialists: allpay positions itself as a long-standing UK prepaid provider serving local authorities and housing associations; it also describes prepaid use in emergency and support payments.
- Newer launches (UK-focused): industry commentary highlights DOSH, a UK-focused prepaid Mastercard account launched by allpay (June 2025), demonstrating continued product activity aimed at inclusion and alternative onboarding.
Accelerate prepaid “tap-to-pay” usage by making programs wallet-ready and contactless-first
- Prepaid usage in the UK is increasingly “tap-first”: card and app-based prepaid accounts are positioned as everyday spend instruments, typically paired with Apple Pay/Google Pay and real-time spend alerts. UK Finance reports that contactless remains a large share of card payments (e.g., in October 2025, contactless accounted for 66% of all credit card and 76% of all debit card transactions).
- UK consumer payment behaviour is structurally contactless-led; UK Finance’s Payment Markets reporting shows that most cards in circulation are contactless-enabled, and a large share of the population regularly uses contactless. This pushes prepaid issuers to compete on provisioning into wallets, frictionless POS acceptance, and controls rather than on physical distribution.
- This will intensify as the FCA removes the regulatory requirement for a single national contactless limit from 19 March 2026, allowing PSPs to set limits on a risk-based basis (with customers able to set limits/disable contactless). Prepaid programmes will need stronger fraud monitoring and clearer customer communications to sustain higher-value contactless usage without increasing losses.
Raise the operating bar as FCA safeguarding reforms reset expectations for e-money-backed prepaid
- The UK is moving toward a tougher safeguarding baseline for payments and e-money firms, which will directly affect prepaid models in which customer value is held as e-money. FCA PS25/12 (Aug 2025) sets out changes intended to reduce safeguarding shortfalls and to improve the speed and certainty of the return of funds in the event of a firm’s failure.
- The FCA has stated that it has found weaknesses in some firms’ safeguarding practices and is using rule changes to reduce consumer harm and improve the regulator’s visibility/intervention. Reuters reporting on the reforms also highlights the move toward more frequent checks and reporting/audit expectations for larger firms.
- This will intensify: partner selection for prepaid programmes (BIN sponsor, programme manager, processor) will weigh governance, reconciliations, audit-readiness, and wind-down planning more heavily. Smaller or weaker operators may exit or be forced into higher-cost operating models, concentrating share among firms that can absorb compliance uplift.
Scale prepaid for financially underserved segments via “banking-alternative” prepaid accounts
- UK prepaid remains a practical option for consumers who cannot or do not want to use a traditional current account, with providers offering prepaid accounts with app controls, Faster Payments, and wallet compatibility. Examples include Pockit (a prepaid Mastercard with Apple Pay/Google Pay positioning) and Suits Me (an e-money account with a card positioned as a banking alternative).
- Continued consumer preference for digital-first money management, plus the operational need for controlled-spend instruments, supports demand for prepaid-led “banking lite” propositions. These models typically emphasise spend controls and budgeting rather than credit creation.
- Expect steady expansion, but with tighter compliance and an outcomes-focused approach: providers will need to demonstrate appropriate onboarding, transparent fees, and strong safeguarding under the evolving FCA regime. Competitive differentiation will shift toward reliability, dispute handling, and fraud controls rather than feature lists.
Expand prepaid in public-sector and emergency disbursement workflows
- Prepaid cards are being used in UK disbursement contexts where speed and controlled spend matter (e.g., emergency welfare or support payments). Allpay describes local councils and charities using prepaid cards for housing support and emergency payments in recent UK-facing content.
- Disbursement programmes value rapid issuance, controlled merchant acceptance, and audit trails features that prepaid can deliver when recipients may not have suitable bank accounts. This aligns with public sector needs for accountable distribution and reduced cash handling.
- This is likely to remain durable where councils/agencies prioritise speed and control; however, procurement scrutiny will increase around safeguarding, data handling, and outcomes for vulnerable people. Providers that can evidence governance and reporting discipline will be at an advantage.
Overview of Prepaid Cards and Digital Wallet Market
Prepaid Card Market Analysis
- Metrics Assessed: The study examines the prepaid card market through various lenses, including transaction value, transaction volume, average transaction value, load value, and the total number of cards in circulation.
- Card Types: A distinction is made between open-loop and closed-loop prepaid cards, providing insights into their respective market shares and growth trajectories.
- Usage Categories: The report segments the prepaid card market into various categories such as general-purpose cards, business and administrative expense cards, travel forex cards, and meal cards.
- Business Segmentation: Further segmentation is provided based on business size and type, including small-scale businesses, mid-tier businesses, enterprise-level businesses, government entities, and retail consumers.
- Sector-Specific Applications: The analysis extends to specific sectors utilizing prepaid cards, including transit and toll payments, healthcare and wellness services, social security and other government benefit programs, fuel purchases, utilities, and more.
Digital Wallet Market Insights
- Key Segments: The digital wallet market is dissected across five primary spending categories: retail shopping, travel, entertainment and gaming, dining establishments, and recharge and bill payments.
- Performance Metrics: For each segment, the report evaluates transaction value, transaction volume, and average transaction value, offering a granular view of consumer spending behaviors.
- Retail Spend Breakdown: An in-depth analysis is provided for retail spending via digital wallets, covering categories such as food and grocery, health and beauty products, apparel and footwear, books, music and video, consumer electronics, pharmacy and wellness, gas stations, restaurants and bars, toys, kids and baby products, services, and other miscellaneous categories.
Virtual Prepaid Card Market Segmentation
- Categories Analyzed: The virtual prepaid card market is segmented into key categories, including general-purpose cards, gift cards, entertainment and gaming cards, teen and campus cards, business and administrative expense cards, payroll cards, meal cards, travel forex cards, transit and toll cards, social security and other government benefit program cards, fuel cards, utilities, and other miscellaneous categories.
- Performance Evaluation: For each category, the report assesses transaction value, providing insights into the adoption and usage patterns of virtual prepaid cards across different consumer segments.
Consumer Usage Trends
- Age Groups: Identifying usage patterns across different age demographics.
- Income Levels: Analyzing how income brackets influence prepaid card adoption and usage.
- Gender: Examining differences in usage trends between genders.
Key Attributes:
| Report Attribute | Details |
| No. of Pages | 159 |
| Forecast Period | 2026 – 2030 |
| Estimated Market Value (USD) in 2026 | $59.83 Billion |
| Forecasted Market Value (USD) by 2030 | $82.73 Billion |
| Compound Annual Growth Rate | 8.4% |
| Regions Covered | United Kingdom |
For more information about this report visit https://www.researchandmarkets.com/r/4oe6q1
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- United Kingdom Prepaid Card and Digital Wallet Market
