While the weather led to several absences atthe first day of the American Conference Institute’s Prepaid CardCompliance Conference last Thursday in Washington DC , it was theregulatory forecast that was causing concern among theattendees.
Regardless of the particular segment of prepaid, all signs seem topoint to additional prepaid regulatory action in 2014. Theconference panels covered everything from money transmitterlicenses, to the Consumer Financial Protection Bureau’s advancednotice of proposed rulemaking, to international money transfers.Even in an area that has positive initial signs – appeal of theJudge Leon ruling on debit interchange and routing – conferencegoers were hesitant to declare victory.
The advice from the panels differed in the particulars dependingon the topic, but it all carried a universal theme – make sure thatyour regulatory house is in order, and do the same for yourpartners. The complex nature of the prepaid value chain can createrisks at each link in the chain. Thinking through thevulnerabilities can help prevent trouble if the players plan ahead.Another preventative measure for prepaid providers is to thinkabout how their products could be misused and develop systems thatmonitor for signs of the misuse.
Of course, the industry is not stuck merely reacting to changingcircumstances. Since many of the changes will still need to gothrough a comment period, there is an opportunity for companies toweigh in and influence the final shape of the regulations.Companies need to monitor the agencies for comment periods andweigh in when the opportunity arises.
Along with the discussions about prepaid, bitcoin and othercryptocurrencies regularly came up in conversation. Here, too, theconsensus seems to be that bitcoin’s future will be largelydetermined by regulation – that is as soon as the regulators andeveryone else figures out exactly what bitcoin will be.