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Prepaid Market Takes Gamble On Lottery Gift Cards

Millions of Americans try to strike it rich every year by picking numbers or scratching tickets in lotteries around the country, but a new development could have even people who want nothing to do with lotteries forking over their cash, too.

Scientific Games Corporation and InComm announced Friday (Oct. 16) that the two organizations have partnered to release North America’s first lottery retail gift cards. Pat McHugh, senior vice president of North American lottery systems at Scientific Games, explained in a statement that the gift cards will add a degree of flexibility into an already popular market.

“Imagine being able to give the fun and entertainment of lottery games with the convenience of a gift card,” McHugh said. “InComm is on the leading edge of commerce technology with strong retail partnerships. Their payment network and retail footprint, combined with Scientific Games’ lottery solutions, offers lotteries a way to reach new consumers who may like to purchase lottery games and help drive incremental revenue for lottery beneficiaries such as local retailers, education, senior citizens, infrastructure and the environment.”

Combining the lottery and gift card industries seems like a no-brainer when looking at some statistics. CEB TowerGroup found that gift cards accounted for $124 billion in sales in 2014, with less than $1 billion in unclaimed funds. Though the gift card industry grew at a lower rate than in 2013, there is still cause for hope.

“The gift card market has moved beyond novelty and is now firmly in the mainstream,” Brian Riley, senior research director at CEB TowerGroup, said in a statement. “With maturity comes slowing growth, but innovations in the e-gifting space will ultimately breathe new life into the industry.”

Combining lotteries with gift cards could be the perfect degree of innovation to jumpstart financial growth.

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