Prepaid Debit Card Reviews, Complaints, Etc

Tag: occupy prepaid debit card

  • The Occupy Prepaid Debit Card Announces Fees

    The Occupy Prepaid Debit Card Announces Fees

    In an announcement that was equal parts press release, fundraiser and call to arms, the Occupy Money Cooperative unveiled fees for its new prepaid debit card.

    by Chris Warren

    The Occupy Movement marked the second anniversary of its Wall Street occupation in a way that few would have expected when thousands took to the streets of New York to express their unhappiness with what they declared to be a rigged financial system: by asking members of the 99% for money and releasing proposed fees for its very own prepaid debit card. On Sept. 16 the so-called Occupy Money Cooperative, an entity formed last July to offer financial products and services, officially launched a fundraising campaign to raise enough capital to become an actual player in the financial services industry so many Occupy supporters loathe.

    “It’s finally time!” declared a mass email to Occupy supporters on Sept. 13. “We are launching a crowd-funding campaign to kick-start an innovative, democratic, transparent and cooperatively-run company to provide access to low-cost, high-quality financial services to everyone.” Raising sufficient start-up capital to actually be able to issue a prepaid debit card, let alone any other products and services, is just the first of many hurdles the Occupy Money Cooperative will face – an issue we examined in detail earlier.

    Challenges aside, Occupy’s foray into the prepaid debit card space – with the group’s avowed commitment to not maximize revenues and profits – has the potential to shake-up the industry. That possibility was buttressed when details about the Occupy Card, which will be covered by Federal Deposit Insurance Corporation (FDIC) insurance, and its fees were released just days before the group began its fundraising efforts.

    To get a sense of just how different the Occupy Card’s approach to business is from other prepaid card issuers all one has to do is note the inclusion of a box called “How To Avoid” on its proposed fee schedule. If that’s not enough, take a look at the proposed rock-bottom fees themselves. For instance, there is no initial purchase charge for the card, a fee that usually runs an average of $1.15. More importantly, the monthly fee for the Occupy Card is just $0.99 – and there’s no charge if you load enough money onto the card to become a No Monthly Charge Member – compared to the average monthly fee of $4.88.

    It’s also free to load money onto the card via direct deposit – which is standard among the more consumer-friendly prepaid cards – although adding cash using MoneyPak or Swipe Reload at 7-Eleven and CVS stores costs $4.95, (a fee charged by the stores and not the Occupy Money Cooperative). To get around this charge, the fee schedule offers up this tip. “If you can, use Direct Deposit, or deposit checks and wait – these methods are FREE. When using MoneyPaks remember 3 $100 deposits will cost $14.85. A single deposit of $300 will cost $4.95.” And so it goes with the other fees. Getting cash from an ATM will run $1.95 due to network and third party fees (“Instead, use cash back from stores,” advise the Occupy Card issuers).

    Not all fees can be avoided. For instance, a card replacement runs $9.95 because it requires printing a new one (advice: “don’t lose your card”). Still, if the Occupy Card gains traction, it very well could change the financial services industry in a way that sit-ins and marches never could.

  • Occupy Prepaid Debit Card No Slam Dunk

    Occupy Prepaid Debit Card No Slam Dunk

    When the Occupy Wall Street movement announced its intention to unveil a prepaid debit card this past July, the news stirred plenty of attention. Unsurprisingly, the notion that a group of protesters who directed the bulk of their anger at bankers would enter the financial services industry was too delicious a story for many news outlets to pass up.

    Adding to the allure of the creation of The Occupy Cooperative, which will release the Occupy Card and eventually hopes to offer other banking services to its product line, was the possibility that it could be the start of a shakeup of Wall Street that protests alone could not accomplish. “As we build up the number of users of the card, we shall soon be able to introduce further services that will shake up the current behemoths in the banking sector,” Carne Ross, a founding board member of the Occupy Cooperative, told BestPrepaidDebitCards.com in a recent interview. “These products will serve the same constituency as the card, wherever possible they will bolster the credit unions, provide low-cost choices, bypass the entrenched systems that rip everyone off, and brick-by-brick build alternatives for ordinary folk’s needs.”

    Good intentions and plenty of publicity aside, the Occupy Cooperative faces a tough road ahead. That’s the message of a recent article in Time Magazine entitled “5 Hurdles an “Occupy”-Branded Banking Product Must Clear.” In the story, reporter Martha White identifies a number of challenges Ross and his colleagues will face as they begin their crusade to upend the financial services industry.

    Among the hurdles the Occupy Cooperative must surmount are raising a sufficient amount of start-up capital. In her story, White cites the efforts of Occupy activists in San Francisco, who have tried and failed thus far to cobble together enough cash to launch what’s known as the “People’s Reserve Credit Union.” Also problematic, at least if Occupy intends to act like a regular bank and take deposits and offer loans, are the many, many regulations involved. While the Time article correctly points out that prepaid cards are largely unregulated (at least for now), entering into traditional banking services would require Occupy to buy a bank or credit union, since starting up a new one would mean obtaining a federal or state charter.

    Other challenges Occupy faces also include the need to access the payment system – which costs money – so that cardholders can actually use their plastic and simply being viable financially if, as Ross promises, there are few fees associated with the card. Finally, White uses the example of PerkStreet Financial as a cautionary tale. When PerkStreet launched five years ago, she writes, it promised to upend the banking system by offering consumers such incentives as 2% cash back on debit card purchases. But PerkStreet’s ultra consumer-friendly approach didn’t make it; it will shut down in September. “We tried to change banking, the most broken industry in the country, in the midst of a financial crisis. It was incredibly hard and we were ultimately unsuccessful,” the article quotes PerkStreet CEO Dan O’Malley, from a blog post O’Malley wrote.

    Only time will tell whether Occupy can figure out a way to succeed. Obviously, though, the group that hit the streets to protest inequality and the abuses of the financial system knows better than anybody how hard change can be.

Prepaid Debit Card Reviews, Complaints, Etc