Open-Loop vs Closed-Loop Prepaid Cards
Open-loop cards run on a payment network and can be spent at many merchants. Closed-loop cards are limited to one merchant or a single category. Open-loop gives recipients freedom, while closed-loop lets you steer where the money is spent.
Side by Side Comparison
| FACTOR | OPEN-LOOP | CLOSED-LOOP |
|---|---|---|
| Where it is accepted | Anywhere the network is accepted in the U.S. | A specific merchant or category |
| Recipient choice | Spend almost anywhere | Spend within the chosen brand or category |
| Spend control | The recipient decides | You direct spending to a purpose |
| Best for | Events, holidays, mailers | Remote teams, surveys, rebates, rush sends |
When Open-Loop Wins
Open-loop cards are the flexible default. They are the right choice when recipient freedom matters, when you want a broad reward that works almost anywhere, or when you want a premium feel. Explore our prepaid Visa cards and the rest of the network lineup.
When Closed-Loop Wins
Closed-loop cards are about focus. They work well when you want to direct spend toward a specific purpose, such as a fuel allowance for drivers, a grocery benefit, or a dining reward, or when you want to tie the reward to a category your recipients value. Explore our merchant cards.
How to Choose
Decide how much control you want over where the funds are spent. If recipients should choose, go open-loop. If you want to spend pointed at a category or brand, go closed-loop.
Frequently Asked Questions
Yes. They are accepted wherever their networks are accepted in the U.S.
Category merchant cards such as fuel, grocery, dining, travel, and health and wellness.
Yes. Many programs combine open-loop and closed-loop cards.
Not Sure Which Fits?
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