Modernising digital payment solutions

Chances are you’ve heard about Prezzy Card, you’ve either gifted one or been lucky enough to receive one. And it’s easy to see why, over five million of these cards are printed and sold each year in New Zealand. NZBusines sits down with the man behind Prezzy Card and Gift Station in New Zealand, Roger Smith, who shares his business journey in the digital payments space, and speaks to the e-wallet trend.

When Roger Smith acquired his first payments business in 2010, prepaid mobile top-ups and scratch cards were still common.

He saw an opportunity to modernise the sector and expand into digital transactions. Over the years, he has introduced new payment technologies, expanded product offerings and transformed how Kiwis use gift cards and prepaid payment solutions.

One of the biggest success stories under his leadership is Prezzy Card, a prepaid Visa product that has grown significantly since epay took ownership under Roger’s local leadership as now Regional Managing Director for APAC.

Roger has held several executive roles at the likes of Pepsi Cola, Lion Nathan and Independent Liquor, where he helped launch RTD brands like Woodstock Bourbon and Vodka Cruiser.

Back then, 15 years ago, he recognised that New Zealand’s payments and gift sector was behind while it was a massive business category in the US and England.

Roger saw the opportunity when he acquired Gift Station a small payments business with just five employees and in 2012, and epay, two major competitors in the prepaid mobile and gift card industry.

The acquisition process was “far from simple”, requiring Commerce Commission approval due to concerns about market dominance.

Roger was only allowed to purchase 85 percent of the business, leaving the remaining 15 percent due to regulatory restrictions.

“It was the only split decision in Commerce Commission history – normally, it’s unanimous. To this day, I still think they got it wrong, but instead of fighting it, we focused on outperforming our competitors in the marketplace.”

More than a gift card

Originally launched by KiwiBank in 2006, Prezzy Card was generating $6 million annually by 2013. By the time epay took over in 2019, it had reached $35 million per year and has grown six and a half times since then.

“When we took over the brand, the bank was only printing 60,000 cards at a time. My first print run was 400,000 cards. Now, we print 1.4 million per run, three times a year.”

A strong marketing push was key to the brand’s rapid growth. Roger wanted every Kiwi to know about Prezzy Card and he made sure of it.

“The bank didn’t have Prezzy Card in enough stores. It was only in post shops and a few supermarkets. We put it in way more places: Countdown [now Woolworths], The Warehouse, petrol stations and backed it with a massive marketing push.”

Prezzy Card has also become more than just a gift card.

Roger says that many New Zealanders now use it as a budgeting tool. Loading a fixed amount onto the card each month to manage discretionary spending. Instead of relying on credit cards with high-interest rates, he says that people are using prepaid cards to control their finances while still being able to shop anywhere Visa is accepted.

“If they’ve only got $2,000 of discretionary spend a month, they chuck their bank credit cards away, buy a $2,000 Prezzy Card, and once that’s done, that’s it for the month. They don’t get themselves in trouble by borrowing money they can’t pay back.”

In addition to Prezzy Card, Roger has also led Gift Station’s transformation.

Once a small competitor in the market, it now offers 138 different gift card options and has expanded into digital gift cards and mobile wallets, making prepaid payments more convenient than ever.

Digital transformation

Under Roger’s leadership, the company has embraced digital transformation. One of the most significant innovations has been the Gift Station Wallet, a mobile app that allows users to store multiple gift cards and combine balances into a single transaction.

“Retailers used to struggle with people having multiple gift cards with small balances left over. We saw an opportunity,” Roger says.

Wy not let them store all their cards in one place and combine balances? That’s how the Gift Station Wallet was born.”

Looking ahead, Roger is preparing to launch a reloadable Prezzy Card, allowing users to top up their balance rather than purchasing a new card each time. He also has plans for a multi-currency travel card, enabling customers to convert funds into foreign currencies when travelling.

The company is not just growing in New Zealand. Roger has recently taken over the Australian operations, spending 10 days a month restructuring and expanding the business there. His goal is to replicate the success of Prezzy Card and Gift Station in Australia’s larger market.

Beyond Australia, he sees huge potential in the Pacific Islands, where payment systems remain outdated. Many Pacific Island workers in New Zealand send remittances back home, but traditional money transfer services charge high fees.

He plans to introduce Prezzy Card as a lower-cost alternative, allowing workers to send money securely with fewer transaction costs.

Fraud: The biggest hurdle

Like any fast-growing industry, digital payments come with challenges, and one of the most pressing is fraud.

Criminals are constantly finding new ways to exploit prepaid transactions, making fraud prevention a top priority for Roger’s team.

To stay ahead, they have invested heavily in security, introducing tamper-proof packaging, advanced transaction monitoring, and a fraud detection system with 25 built-in security flags designed to block suspicious activity before it happens.

“The gangs have been hitting gift cards hard over the last three years. They found ways to open the packaging, replace the card, and wait for a consumer to load it before stealing the funds. We’ve worked with our card producers to develop tamper-proof packaging and new security measures.”

Beyond technology, Roger says that educating retailers has been crucial in reducing fraud. Supermarket and petrol station employees are now trained to identify suspicious gift card purchases and intervene when necessary. If a customer appears to be under pressure to buy multiple cards, staff are encouraged to ask key questions that could help prevent scams.

Roger says that these initiatives have already made a significant impact, with fraud rates dropping sharply over the past 18 months.

At the same time, regulatory challenges pose another obstacle. Roger believes that government agencies often lack a full understanding of the payments industry, leading to policy changes that disrupt businesses without sufficient industry consultation.

“The regulators still don’t fully understand this market. They introduce policy changes without consultation, which can create unnecessary barriers for businesses like ours.”

Instead of resisting regulation, Roger takes a proactive approach, working closely with regulators to ensure his company stays ahead of compliance requirements and continues to operate securely and efficiently.