Prepaid Debit Card Reviews, Complaints, Etc

Tag: wall street

  • AmEx Serve Cards Announcement Hits Green Dot

    AmEx Serve Cards Announcement Hits Green Dot

    When American Express announced earlier this week that its prepaid Serve cards can now be purchased at 4,100 Walmarts nationwide, the stock market reacted. But as a story on ABC News points out, Wall Street was mostly interested in what the partnership means for Green Dot, a major player in the prepaid card industry.

    And if the immediate aftermath of this major expansion in the availability of Serve cards to Walmart is any indication, Wall Street believes that Green Dot is in trouble. Indeed, in the two days after AmEx announced that Walmart shoppers could pick up its ultra low-fee Serve cards for $1.95 while buying groceries, Green Dot shares were down over eight percent.

    As the ABC News report makes clear, this is just the latest downturn in what has been a steep decline in Wall Street’s assessment of Green Dot. Not long after Green Dot held its initial public offering in 2010, it soared to over $60 per share. The company’s shares were trading at below $20 after the Serve announcement, which also included the news that the addition of thousands of Walmarts had helped AmEx create the largest free cash reload network in America.

    What’s behind this grim assessment of Green Dot’s prospects? According to Yahoo! Finance’s Mike Santoli, it comes down to competition. “Their whole business is being threatened because they collect prepaid fees off of these debit cards,” Santoli told ABC News. And the fee comparison doesn’t bode well for Green Dot. Consumers can pick up an AmEx Serve card and pay a $1 monthly fee compared to an average $5.95 monthly fee for Green Dot cards.

    There’s also a perception problem for Green Dot, argues Santoli. Both AmEx and Green Dot prepaid cards are available at Walmart. “The perception here is that Walmart is throwing its weight a little bit more behind AmEx than Green Dot,” he says.

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

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  • The Occupy Card Moves Ahead

    The Occupy Card Moves Ahead

    The Occupy Money Cooperative needs to raise $900,000 to make its card a reality.

    by Chris Warren

    The Occupy Wall Street Movement’s first steps into the financial services industry have not been particularly smooth. The announcement this past summer that the Occupy Money Cooperative, an offshoot of the anti-status quo coalition that grabbed the world’s attention with its street protests and barbed criticism of banks in the fall of 2011, would attempt to issue a prepaid debit card was an immediate source of fascination.

    Yet when the proposed fees associated with the Occupy Card were unveiled in September, an avalanche of criticism quickly followed. Far from being hailed as a savior riding to the rescue of helpless citizens being preyed upon by the big banks, respected observers like Consumer Reports declared that the card’s fees were worse than many other products already on the market. “Our first look at those proposed fees shows that the Occupy Card needs some work if its sponsors truly want it to be superior to other prepaid cards,” declared the Consumer Reports review.

    Nevertheless, the supporters of the Occupy Money Cooperative appear just as determined as ever to not only launch its prepaid debit card but to revolutionize the banking system. According to an article in the Cornell Daily Sun, the student newspaper at Ithaca, New York’s Cornell University, university professor Robert Hockett is among those working to make the card a reality.

    According to the article by reporter, Helen Donnelly, the Occupy Card will be launched once Hockett and the other co-founders of the Occupy Money Cooperative can raise $900,000 in initial operating capital. The article does not say how close, or far, the group is from reaching that amount.

    Despite its bumpy rollout, Cornell’s Hockett insists that Occupy’s ambitions are still to go well beyond just a prepaid debit card. “The Occupy Money Cooperative is beginning with the debit card. This debit card is a specific counterpart to cards like these that exist in existing banking institutions already offered. Chase Liquid is probably the best-known example,” Hockett told the newspaper. “The ultimate plan is to offer all the other services that these existing banking institutions already do, but on a non-profit basis.”

     

  • A True Wall Street Occupation?

    A True Wall Street Occupation?

    How the Occupy Card Doesn’t Live up to its Promise  

    by Shane Tripcony

    The terms and conditions of credit, debit and prepaid cards are not what anyone would call scintillating reading. Layered with legalese and hard to decipher jargon, these documents have traditionally (and understandably) been ignored by consumers. Which is too bad because they contain the sort of vital information people need to make smart financial decisions.

    By contrast, the recently announced fee structure for the Occupy Card is a legitimately fascinating read. The Occupy Card is a prepaid debit card that an offshoot of the Occupy Wall Street Movement is hoping to soon introduce to the marketplace, the first of what the so-called Occupy Money Cooperative would like to be an array of financial products and services. And while the proposed fees are not the fully-fledged terms one would wade through with an already available prepaid card, there’s one section you probably won’t find with many other cards: how to avoid the fees. (To be fair, Account Now generously offers tips to save money on their fees page as well, so kudos to Account Now, as well.)

    For instance, the issuers of the Occupy Card dutifully note that it will cost users $1.95 to take money out of an ATM, the result of network and other third party charges (ie. not Occupy’s fault). But to dodge that fee, the Occupy Money Cooperative urges people to get cash back while shopping. It goes on and on like this, with the designers of the Occupy Card offering tips on how to get around fees whenever possible.

    Arguably, in a financial services industry that many believe seeks out revenue generating fees the way a shark hones in on blood, the mere existence of a card-provider tip sheet about avoiding them is incredible. Of course, it’s not a huge surprise, given the Occupy Movement’s loathing of the way it believes Wall Street mistreats its customers and harms society.

    Now, don’t expect other issuers of prepaid debit cards to suddenly follow Occupy’s lead and highlight ways to sidestep their fees. (It sure would be nice, though!) But the sad truth is that they won’t need to because the non-profit, stick-it-to-the-man Occupy Card is far less consumer-friendly than many of the prepaid cards offered by the big banks. That’s right, the greedy capitalists from Wall Street have many, many prepaid debit cards that would cost consumers far less than the offering from the former residents of Zuccotti Park.

    While the Occupy Card has a low monthly account fee of $0.99, the $1.95 charge to take money out of an ATM is painful for anyone – no matter whether it’s the fault of Occupy or not. Also costly are fees for getting basic account information. The Occupy Card charges $2 to speak with a customer service representative and $0.99 to get automated help. As with most consumer-friendly prepaid debit cards, there’s no charge to load the Occupy Card using direct deposit. But any other method to load the card will set people back as much as $5 per transaction. That’s not exactly the kind of help the 99% need.

    It’s also not going to help the Occupy Card gain much traction in the marketplace. Based on our calculations, the average annual fees for the Occupy Card would cost the average consumer $259.40 per year. Truth be told, that lands the Occupy Card squarely in the middle of the pack. There are alternatives, such as Bluebird by American Express, which cost the consumer nothing, based on our standard formula. There are quite a few other cards that average out with lower fees as well. Cards from banking behemoths like Chase and U.S. Bank and American Express offer free ATM withdrawals and cash loads and are, overall, a far better deal for consumers. Even with the fee differences, the Occupy Card does send a message, and many consumers may find the importance of sending that message to be worth those higher fees. Bottom line, here’s the question for everybody: Are you up for occupying the Occupy Card?

Prepaid Debit Card Reviews, Complaints, Etc