Ecount News & Press Releases

Citigroup to Launch Prepaid Business

Citigroup is planning to introduce prepaid debit cards in Europe after buying the largest provider of the cards to companies in the fast-growing US market.

Citigroup's transaction services arm will today announce that it is paying an undisclosed sum for Ecount, a 10-year-oldPennsylvania-based company that processes payroll cards for more than 1,000 companies in North America, including a third of the Fortune 100.

Citigroup wants to expand the business into less developed overseas markets and plans launches in the UK, Germany and Australia over the next year.

Companies such as Toyota and Sprint use the cards to reduce costs by cutting out the need for paper cheques. The cards make it possible to pay employees that do not have bank accounts electronically.

According to Celent, the research firm, more than 4m US workers had payroll cards in 2006, a five-fold increase in four years.

Ellen Alemany, chief executive of Citigroup's global transaction services arm, said companies wanted more flexibility in electronic payments.

"By combining Citi's industry-leading payment products and client base, with Ecount's expertise, technology and distribution in stored value cards, we will be a leader across all North American payment channels."

She said there were also big opportunities withgovernment and outside the US. Transaction services is one of the fastest growing parts of Citigroup's business, reporting earnings up 26 per cent to $1.43bn last year on revenues up 22 per cent.