CFPB Proposes New Regulation of the Prepaid Market
Financial Institutions Law Alert 12/08/14 By Thomas McDonell, Stanley F. Orszula
On November 13, 2014, the Consumer Financial Protection Bureau ("CFPB") released a proposed rule that would extend federal consumer protections to prepaid financial products. Among other things, the proposed rule obligates financial institutions to provide consumers with additional disclosures before prepaid cards are acquired, including disclosure of all fees associated with the prepaid account and more detail on how those fees are assessed. The CFPB believes the rule would "close the loopholes in this market and ensure prepaid customers are protected whether they are swiping a card, scanning their smartphone, or sending a payment."
See the proposed rule at: http://files.consumerfinance.gov/f/201411_cfpb_regulations_prepaid-nprm_proposed-rule.pdf