When you’re playing the credit card game and/or the manufactured spending game, it’s a zero-sum affair. That is, if you’re winning then somebody else is losing. Obviously, if you’re doing a good job then banks will get the short end of the stick, but what about the retailers selling prepaid debit cards?

I haven’t been able to find much information on the economics of this industry from the retailer’s perspective, but I did find this link from Prineta, a payment services consulting firm. They write:

Our average merchant makes 10% a month off prepaid sales blended across all the products. So if you sell $1000 worth of cards you would see about $100 commission.  Sell $5000 worth of prepaid and the commissions should be closer to $500 a month.  Some of the busiest locations are making more than $8000 per year from prepaid.  Not bad considering there is no set up cost.  It’s like free money for a c[onvenience]-store.

Which sounds great for prepaid debit vendors until you dig into the numbers a bit. The highest commissions by far are on prepaid long distance, for which the merchant payout is in the 20-30% range. For plain-jane gift cards, the payout looks like this:

Sell a $250 Gift Card and make $1.60
Sell a $100 Gift Card and make $1.30
Sell a $50 Gift Card and make $1.00
Sell a $25 Gift Card and make $0.70

And the prepaid cards? Here’s what they say (GPR=general purpose reloadable):

• Visa GPR Debit Initial Purchase (card cost $3.00) 35.00% of card cost
• Visa GPR Debit Reload (card cost $2.95) 30.00% of card cost

A $3 fee seems low to me, but whatever. If I’m reading this correctly, retailers’ profit would about a third of whatever the card activation fee is. Given credit card processing fees and fraud risk, I’m grateful this game is still active.

Are any of you aware of any better information than this on prepaid economics?

I’ve been wanting to follow-up on the “Another darn ‘Blogs I Like'” post I did recently, except I just checked and I wrote that thing back in December, so it’s not as recent as I thought. Better late than never, yes?

Keep in mind I’m not trying to make any objective list of good blogs, these are just ones I happen to follow most closely because of my own interests and idiosyncrasies. The blogs I listed back then were:

• TravelBloggerBuzz because I stole the “blogs I like” idea from him and didn’t pay him anything. Though I’ll point out that I did order a bunch of stuff via his Amazon link in the wake of a certain Best Buy promotion, so I consider us even.
• The Big Picture because I thought I should have something not related to points or miles to make me look well-rounded.
• Big Habitat and Chasing The Points because apparently I had access to a time machine and discovered that they would be joining Saverocity.
• MilesAbound for turning me on to the GE credit card scene.
• Frequent Miler because he’s Frequent Freakin’ Miler.
• TravelIsFree for publishing really cool travel-hacking stuff.
• DansDeals for generally having lots of good information.

I invited readers to suggest other blogs that ought to be on the list, and the first one mentioned was View From The Wing. In retrospect, I should have had this one on there the first time around, but it slipped my mind. Our baby was barely a month old at the time, which may or may not have had something to do with that. It could also be an alien abduction that is causing issues, but either way there are gaps in my memory.

Anyway: after I wrote the post and somebody mentioned Gary’s blog, I immediately started noticing how frequently I end up reading Gary’s blog, which is at least twice a day. Many biotechnology experts believe that Gary has actually cloned himself, therefore allowing him to write as many as 50 high-quality posts per day.

I would also add the Free-quent Flyer, a blog I’ve recently had the pleasure of discovering. High quality content, and worth your time if you’re into this stuff.

Another commenter mentioned Milenomics, which I wasn’t too familiar with at the time. I would concur: Milenomics is pretty good, and in fact I’ll recommend you read the Reloadit Safe post he just put up.

One commenter mentioned three blogs: Political Calculations and Monevator, which seem like pretty good stuff but just aren’t my cup of tea; and Budgets Are Sexy, which is actually in my RSS feed but rarely linked to here. The one thing I do like about BAS is the Side Hustle series, wherein somebody with a job for extra money spills the beans on what they’re doing. If you’re looking to make a little extra income (you know, aside from credit cards), it’s good reading.

Finally, someone mentioned Milenerd. It’s also pretty good, but it’s more purely travel-focused, and since I am, alas, not traveling too much these days, a good amount of his content just isn’t on my radar.

That’s all I have. If you’d like to spread the word about a good blog (only somebody else’s blog, no self-promotion here), even if it’s not necessarily relevant to the usual points-n-miles discussions, then by all means comment below. Salacious gossip is always welcome too.