Prepaid Debit Card Reviews, Complaints, Etc

Tag: financial services

JPMorgan Launches Financial Solutions Lab

American Express just got a little competition in its efforts to appeal to those living outside the financial mainstream. On May 29^th, banking giant JPMorgan Chase & Co. announced that it has committed to invest $30 million to create the Financial Solutions Lab.

A collaboration with the Center for Financial Services Innovation, the new Financial Solutions Lab will tap the expertise of entrepreneurs, non-profits and academics to develop products and technologies to help people save more money and build better credit. The new venture is geared towards helping those who are not fully served by the current financial system. “Living outside the financial mainstream puts financial security further out of reach for one out of every four American households that rely on high-cost, non-bank services to manage their finances,” says Bruce McNamer, the CEO of the JPMorgan Chase Foundation. “The Financial Solutions Lab will bring together the best and the brightest to identify innovative solutions that help consumers increase savings, improve credit and build assets.”

Buttressing its decision to launch the Financial Solutions Lab, JPMorgan Chase and the University of North Carolina at Chapel Hill also released a white paper that illustrates the need for improved financial services. For instance, the paper notes that less than 10 percent of working American families are financially prepared for retirement while more than half do not have an adequate emergency fund. The research also shows how important savings can be as a vehicle for upward mobility. Indeed, 71 percent of kids born to low-income parents who managed to be big savers were able to move out of the bottom income quartile.

This new JPMorgan Chase initiative will, among other things, host competitions that encourage social entrepreneurs to devise ways to help encourage saving and credit building. In doing this, JPMorgan is echoing American Express’s well-publicized efforts to provide solutions to millions of so-called unbanked Americans. Besides its checking account alternative Bluebird and Serve prepaid cards, American Express sponsored a new documentary film, Spent, which shines a light on the difficulties and expense those who don’t have bank accounts or credit cards face to do simple tasks like pay bills and cash checks.

June 4, 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
Girl Scouts Embrace Prepaid Cards

A Girl Scouts chapter strikes a deal with prepaid card company, SpendSmart Payments.

by Chris Warren

Thin Mints, Samoas, Tagalongs and Lemonades are definitely not financial terms. Yet the truth is that, aside from fundraising, one of the main reasons Girl Scouts from across the country sell these and other varieties of cookies is to learn something about money management and running a business. Think about it: Successfully selling hundreds or thousands of cookies requires smart marketing and sales strategies, wise inventory management as well as record keeping and order tracking.

While involvement with the organization’s sprawling cookie business is certainly one way for young girls to become more financially aware and savvy, one Girl Scouts chapter has gone a step further. In October the Charlotte, North Carolina-based Hornets’ Nest chapter announced that it had established a partnership with SpendSmart Payments Co., a financial services outfit and prepaid debit card issuer based in San Diego, California.

According to a recent story in The Kansas City Star, SpendSmart is crafting a financial education program that will be offered starting in January of 2014 to the 16,000 girls in North and South Carolina who make up the Hornets’ Nest chapter. With materials designed to appeal to girls from kindergarten through high school, the curriculum being developed by SpendSmart is meant to help girls understand the value of money and credit, as well as learn how to budget and use plastic wisely.

“That last point of emphasis caught my attention,” Kansas City Star reporter Steve Rosen wrote. “As part of its partnership, Scouts 13 and older can sign up for the SpendSmart Prepaid MasterCard.”

It is understandable why SpendSmart would be eager to become well known by thousands of young girls. The company offers prepaid debit cards specifically designed for teens and parents. Among other features, SpendSmart cards alert parents via text or email whenever a purchase is made, allowing them to monitor how well (or poorly) kids are spending money.

Rosen points out that SpendSmart charges a $3.95 monthly fee, an amount that is both far higher and lower than other prepaid debit cards. He also notes that prepaid cards like those offered by SpendSmart also charge for withdrawing money from an ATM, replacing a card and checking an account balance. “The upshot: Whether it’s SpendSmart or some other prepaid debit card, weigh the costs against the services provided and decide on the best deal.”

SpendSmart certainly hopes the Girl Scouts like the cards and the information they’re offering. The company hopes the deal with the Hornets’ Nest chapter is the first of many partnerships with the Girl Scouts.

November 22, 2013