Zum Rails has announced the launch of a new suite of Mastercard-powered prepaid card programs in Canada. This initiative aims to streamline expense management for businesses across the country, excluding British Columbia. The prepaid cards are designed to enhance financial flexibility, allowing companies to offer their employees seamless access to funds for corporate spending.
The prepaid cards will enable businesses to provide employees with co-branded, reloadable options. This functionality not only facilitates faster access to earned wages but also allows for immediate payments to contractors. Additionally, companies can implement cards that offer benefits such as credit-building services, specifically targeting underserved customers, according to Zum Rails.
In a statement, Miles Schwartz, CEO and Co-founder of Zum Rails, emphasized the importance of efficient financial transactions. “At Zum Rails, we believe money should move at the speed of business, and we’re making it easier for businesses to embed smarter, faster payments into their operations,” Schwartz stated. He highlighted that the new prepaid card programs eliminate the complexities associated with traditional financial infrastructures, allowing companies to move funds in near real time.
This partnership comes amid growing dissatisfaction among small and medium-sized businesses (SMBs) regarding their current card options. Recent research from PYMNTS Intelligence, detailed in the “SMB Growth Monitor Report: How Firms Use and Choose Credit Cards,” reveals a significant disconnect between available credit card features and the specific needs of many industry-focused SMBs.
The report indicates that despite the multitude of credit card options, SMBs would increase their spending if cards offered tailored features. For example, construction firms seek automation, salons require enhanced fraud protection, and retailers desire additional perks. The findings suggest that current card programs often treat diverse businesses uniformly, failing to address their unique requirements.
This situation has led to a financial services gap, where traditional credit card offerings are unable to meet the evolving demands of a dynamic business landscape. The research also highlights a concerning trend: 54% of SMBs report using both personal and business credit cards to finance their operations. This figure rises to 61% among companies located in large urban centres.
According to PYMNTS, “For these SMBs, credit cards are not just financing tools but stopgap solutions in a financial system not yet optimized for their needs.” The current hybrid usage of credit indicates a market inefficiency, with traditional business credit products proving insufficient on their own.
As Zum Rails expands its offerings in Canada, the collaboration with Mastercard reflects a growing recognition of the need for more responsive financial solutions tailored to the unique circumstances of SMBs. The introduction of these prepaid cards aims to empower businesses, providing them with the tools needed to manage expenses efficiently while supporting their employees and contractors.