The new prepaid regulations will hurt consumers by limiting their access to prepaid cards, according to an editorial in Roll Call by H. West Richards is executive director of the American Transaction Processors Coalition.
The CFPB’s proposed rule, if adopted as written, could severely diminish the quality of life for some of the most-financially vulnerable Americans by greatly limiting their access to prepaid cards. The CFPB closed its public comment period last week, but the American Transaction Processors Coalition is committed to partnering with the Network Branded Prepaid Card Association and others to educate the regulator and members of Congress about the wide-ranging rule’s potential unintended consequences.
Mercator Advisory Group agrees that these rules will end up harming the very people they are supposed to protect. Even if prepaid cards do not disappear, the rules are structured in such a way that by making disclosures on cards simple, the rules force prepaid providers to omit important information such as third-party fees.
Richards’s piece points out that this debate has moved beyond the public comment period into the Congressional realm. While the final rules will not be available for some time, the industry is wasting no time in looking for different avenues to try to prevent an outcome that would be bad for consumers and bad for the industry itself.
Overview by Ben Jackson, Director, Prepaid Advisory Service for Mercator Advisory Group
Read the article here.
Mercator’s report on the CFPB rules can be found here.