Zum Rails has introduced a suite of prepaid card programs powered by Mastercard in Canada, aimed at improving expense management for businesses. This initiative, announced on August 21, 2023, allows companies to provide employees with reloadable cards designed for corporate spending. The service is available across every Canadian province except British Columbia.
The prepaid cards will enhance the financial flexibility of businesses by enabling features such as real-time disbursements and faster access to earned wages. Employers can load funds onto these cards for immediate use, streamlining payments for both employees and contractors. Additionally, the cards can incorporate benefits such as credit-building services, specifically targeting underserved customers.
“Our goal at Zum Rails is to facilitate the rapid movement of money in business,” said Miles Schwartz, CEO and Co-founder of Zum Rails. “With our Mastercard-powered prepaid card programs, businesses can now offer branded cards that enable near real-time transactions without the complexities associated with traditional financial systems.”
The timing of this launch aligns with growing dissatisfaction among small and medium-sized businesses (SMBs) regarding their current card options. Recent findings from the SMB Growth Monitor Report by PYMNTS indicate a significant disconnect between the offerings of standard credit cards and the specific needs of industry-focused SMBs.
According to the report, many SMBs would be willing to spend more if card features were tailored to their unique operational requirements. For instance, construction firms are seeking automation, salons prioritize fraud protection, and retailers desire additional perks. The study highlights that these businesses do not lack access to credit but are underserved by generalized financial products.
The research further reveals a blending of personal and business finances, with 54% of SMBs admitting to using both personal and business credit cards for operational costs. This figure rises to 61% among businesses located in large urban areas.
For many of these businesses, credit cards serve not merely as financing tools but as temporary solutions within a financial ecosystem that has yet to meet their specialized needs. “Although flexibility is essential, this reliance on a hybrid of credit sources underscores a market inefficiency: traditional business credit offerings are not sufficiently compelling or comprehensive,” PYMNTS noted.
The introduction of Zum Rails’ Mastercard prepaid cards could represent a significant step towards addressing these gaps in financial services, providing businesses with the tools they require to operate more effectively in a competitive environment. As the landscape continues to evolve, the emphasis on tailored financial solutions is likely to grow, benefiting both businesses and their employees.
