Today's Headlines: New CFPB Rules For Prepaid Cards

MoneyTips

Regulation Comes to Prepaid Cards

How do you get by in today's economy without a bank account? Americans who are living paycheck-to-paycheck may choose to avoid banks because of the potential for fees, overdraft charges, and ATM access concerns.

Prepaid cards offer a viable alternative to these consumers, and such cards are growing in popularity. A study by the Pew Charitable Trusts found that 45% of prepaid card users choose prepaid cards to avoid bank overdraft fees and 27% of those who regularly use prepaid cards do not have a bank account at all.

However, due to the limited regulation of these cards, consumers can end up paying more in fees than the bank charges that they were trying to avoid. Further, these cards do not provide consumer protections similar to bank accounts and/or credit cards — but thanks to the

from MoneyTips http://www.moneytips.com/todays-headlines-new-cfpb-rules-for-prepaid-cards/457