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.

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Consumer Advocates: Credit CARD Act Saves $12.6 Billion Annually

On the fifth anniversary of the passage of the federal Credit CARD Act of 2009, a group of consumer advocates praised its effectiveness in saving Americans $12.6 billion per year and urged similar legislation for debit and prepaid cards. Groups ranging from Americans for Financial Reform to Consumer Action to the National Consumer Law Center argue that the controversial legislation has helped eliminate many consumer-unfriendly fees and practices.

“The CARD Act has been hugely successful in banning the biggest unfair credit card gotchas like retroactive interest rate hikes and excessive penalty fees,” says Linda Sherry, Director of National Priorities at Consumer Action. The Consumer Financial Protection Bureau (CFPB) has calculated that the law saves consumers $4 billion per year in fees alone, while another estimate puts the total savings from banned interest charges and fees closer to $13 billion each year.

While Sherry says that more action is needed to bolster credit card protections, like limits on fees and other credit safeguards, she and the other advocates used the anniversary to urge legislation to address problems with debit and prepaid cards. In particular, the groups take aim at overdraft fees, which the Center for Responsible Lending costs consumers nearly $6 billion per year. “Overdraft fees should be completely banned on debit and prepaid card transactions,” says Lauren Saunders, associate director of the National Consumer Law Center. Rather than overdraft fees, Saunders says that transactions can be denied and consumers should have the option of skipping the purchase or paying with credit. “Keeping overdraft fees off of prepaid cards is especially important to keep those cards safe for people who have been shut out of bank accounts.”

The consumer advocates urge lawmakers to pay special attention to prepaid cards, which they say have no consumer protections under federal law or regulations. The CFPB is currently considering new rules to protect debit and prepaid card users. Earlier this year Virginia Senator Mark Warner introduced legislation that would require prepaid card issuers fully disclose fees associated with these products.

May 27, 2014
AmEx Sees Surge In Prepaid Customers

Participants at last week’s Sanford Bernstein’s investor conference in New York City could be excused if they thought they had stumbled into a political rally. Giving the final formal presentation at the “Disruptive Trends in Financial Services” gathering, American Express Group President for Enterprise Growth, Dan Schulman, made an impassioned critique of the way the current financial system functions, or doesn’t, for the 50 percent of Americans who live paycheck to paycheck.

“There’s an epidemic of people being forced to the margins of our financial system,” Schulman said, citing statistics from the Federal Deposit Insurance Corporation (FDIC) that 70 million Americans are either unbanked or under banked, meaning they either lack a basic checking account or credit card. Tens of millions more, he said, are “unhappily” banked, forced to pay ever increasing fees for checking accounts that banks offered for free, in the past.

According to Schulman, this situation has forced far too many people to pay high fees and wait in long lines just to make basic financial transactions, like paying bills or cashing a check. Schulman gave the example of payday loans that aren’t immediately repaid incurring interest rates upwards of 500 percent. The belief that there is a fundamentally more equitable way to deliver financial services than what is currently offered by brick and mortar bank branches has led American Express to launch its low-cost Serve prepaid card and Bluebird checking account alternative. Schulman went so far as to say that it was a “defining mission” of American Express “to explode the paradigm that it’s expensive to be poor.”

If that is the mission at American Express, Schulman offered some pretty strong evidence that the company is making progress towards it. He told the conference that American Express has added almost 2.5 million new Bluebird and Serve customers since the beginning of the year. That brings the total number of customers to about 9.5 million. Additionally, Schulman reported that Serve and Bluebird customers have loaded about $1.9 billion into their accounts in the first four months of the year.

May 22, 2014

Category: Best Low Fee Prepaid Cards

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)

Consumer Advocates: Credit CARD Act Saves $12.6 Billion Annually

AmEx Sees Surge In Prepaid Customers

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)