Credit and Debit Card Ratings

Prepaid Cards For Wisconsin Employees

Earlier this summer there were a series of negative media stories about the practice some companies were embracing of paying employees using prepaid debit cards. A frequently cited story in The New York Times described how companies like McDonald’s, Walgreens and Wal-Mart were eschewing paper checks and direct deposit in favor of prepaid debit cards as the preferred method of compensating employees.

Reactions to that story in particular – which featured minimum wage workers who expressed frustration over having to pay fees associated with prepaid debit cards in order to access money they earned – were largely critical of the practice. For their part, businesses have opted for prepaid debit cards over paper checks and direct deposit for a very simple reason: it saves them potentially thousands of dollars each year in payroll expenses. Still, the practice has raised enough of an outcry that New York Attorney General Eric Schneiderman opened up an investigation into 20 companies utilizing prepaid debit cards to pay their workers.

Despite all of the recent bad press around utilizing prepaid debit cards to pay workers, more employers are getting into the act – and what makes it a little bit different is the fact that it’s no longer limited just to the private sector. Indeed, according to a recent report in the Wisconsin State Journal, employees at state agencies there can now be paid via a program called AccelaPay, a prepaid debit card issued by U.S. Bank. According to the story, written by Matthew DeFour, the prepaid debit card payment option is not compulsory, but is instead proposed as a an option for state employees who don’t have a traditional bank account. Explaining the offer, a Wisconsin state official said that it was “a safe, convenient and ‘green’ way to automatically receive and access their paycheck funds. AccelaPay is faster, safe and more secure than a paper check.”

Nevertheless, according to Marty Beil, the executive director of the state employee union, employees did not ask for the option of receiving their salaries on prepaid debit cards and there is no concern that it will eventually become a requirement. As is the case with most prepaid debit cards, there is also concern about the fees. In the case of AccelaPay, it costs $0.50 for each balance inquiry and $2 for all ATM withdrawals outside the U.S. Bank network. No fees are charged for account inactivity or for making purchases or receiving cash back on purchases.

Category: Best Low Fee Prepaid Cards

Millions of people are turning to prepaid debit cards as a smart alternative to carrying cash and writing checks. Almost anyone can qualify and they don’t require a credit check or a bank account.

Though they carry credit card logos and can be used anywhere a credit card is used, unlike a credit card, they do not offer a line of credit. The user can only spend the amount that has been loaded onto the card or placed into the account associated with the card.

There are dozens of debit cards on the market, many of them issued by the same bank, but fee structures are vastly different. Bestprepaiddebitcards.com has done all the research for you and provides comprehensive reviews to help you decide which card is best for you.

GO2bank Offers Overdraft Protection up to $300.

And build your credit with the GO2bank Secured Visa® Credit Card with no annual fee*, no credit check*, and no impact to your credit when you apply. (sponsor link)

  • Prepaid Cards For Wisconsin Employees

    Prepaid Cards For Wisconsin Employees

    Earlier this summer there were a series of negative media stories about the practice some companies were embracing of paying employees using prepaid debit cards. A frequently cited story in The New York Times described how companies like McDonald’s, Walgreens and Wal-Mart were eschewing paper checks and direct deposit in favor of prepaid debit cards as the preferred method of compensating employees.

    Reactions to that story in particular – which featured minimum wage workers who expressed frustration over having to pay fees associated with prepaid debit cards in order to access money they earned – were largely critical of the practice. For their part, businesses have opted for prepaid debit cards over paper checks and direct deposit for a very simple reason: it saves them potentially thousands of dollars each year in payroll expenses. Still, the practice has raised enough of an outcry that New York Attorney General Eric Schneiderman opened up an investigation into 20 companies utilizing prepaid debit cards to pay their workers.

    Despite all of the recent bad press around utilizing prepaid debit cards to pay workers, more employers are getting into the act – and what makes it a little bit different is the fact that it’s no longer limited just to the private sector. Indeed, according to a recent report in the Wisconsin State Journal, employees at state agencies there can now be paid via a program called AccelaPay, a prepaid debit card issued by U.S. Bank. According to the story, written by Matthew DeFour, the prepaid debit card payment option is not compulsory, but is instead proposed as a an option for state employees who don’t have a traditional bank account. Explaining the offer, a Wisconsin state official said that it was “a safe, convenient and ‘green’ way to automatically receive and access their paycheck funds. AccelaPay is faster, safe and more secure than a paper check.”

    Nevertheless, according to Marty Beil, the executive director of the state employee union, employees did not ask for the option of receiving their salaries on prepaid debit cards and there is no concern that it will eventually become a requirement. As is the case with most prepaid debit cards, there is also concern about the fees. In the case of AccelaPay, it costs $0.50 for each balance inquiry and $2 for all ATM withdrawals outside the U.S. Bank network. No fees are charged for account inactivity or for making purchases or receiving cash back on purchases.

  • Swipe-Fee Rule Rejection Helps Merchants and Banks’ Cost

    Swipe-Fee Rule Rejection Helps Merchants and Banks’ Cost

    After winning a court ruling on claims they were over charged billions of dollars under and unlawful rate set by the Federal Reserve, retailers battling banks over debit-card transaction costs may soon benefit from lower fees.  In Washington, U.S. District Judge Richard Leon ruled on Tuesday that in setting the cap on debit card transaction fees at 21 cents, the Federal Reserve considered data it wasn’t allowed to use under the Dodd-Frank law and neglected to bolster competition in card networks.

    “The board’s final rule not only fails to carry out Congress’s intention; it effectively countermands it!” Leon wrote in his ruling.

    Before Federal Reserve regulations cut back on perks such as reward programs and free checking to soften the blow, Lenders collected about $16 billion annually from swipe fees.  Unless overturned, the decision will force regulators to revisit rules that bankers said would cost them 45% of their swipe-fee revenue.

    “In effect since October 2011, the Fed’s rule will stay in place until the central bank drafts new regulations or interim standards,” Leon said.

    Frank Keating, the president of the American Bankers Association, said the decision “will harm banks of all sizes and make it more difficult for institutions to serve their customers.”  “The price controls enacted as a result of the Durbin Amendment served one purpose – further lining the pockets of our nation’s big-box retailers at their own customers’ expense,” Keating said in a statement.  “It was – and still is – all about trying to help retailers increase profit margins while providing no real benefit to consumers.”

    Merchants previously paid banks an average of 44 cents per transaction.  The Fed first proposed cutting the sum to 12 cents before settling on 21 cents after bankers complained.

    “Tuesday’s ruling will lead to lower interchange rates for billions of debit card transactions each year,” said Durbin, who filed a brief in the case supporting the retailers.  “The Fed’s 2011 decision to bend to the lobbying by the big banks and card giants cost small business and consumers tens of billions of dollars and did not do enough to rein in the anti-competitive, anti-consumer practices of Visa and MasterCard”.

    Leon, who said the Fed rule raised costs for debit transactions under $12, said he was inclined to give the Fed “months, not years” to rewrite the rule.

    “The starkest, most powerful evidence of how absurd this rule was is that it resulted in a price increase,” Jeffrey Shinder, an attorney at Constantine Cannon LLP in New York who filed a brief for a group of retailers including 7-Eleven Inc. and Wendy’s Co.

    The case is NACS v. Board of Governors of the Federal Reserve System, 11-cv-02075, U.S. District Court, District of Columbia (Washington).

    For more information, visit:  http://www.bloomberg.com/news/2013-07-31/fed-s-debit-card-swipe-fee-limits-rejected-by-u-s-judge.html

     

Credit and Debit Card Ratings