Pew promotes disclosure box for prepaid cards
March 3, 2014 – Pew Charitable Trusts last week released a model disclosure box for general-purpose, reloadable prepaid cards to promote uniform disclosures.
In a recent survey, Pew found that just 32 percent of consumers compare terms before choosing a card. It found that most consumers select their cards while in a store without doing comparisons or use cards recommended by family or friends. Yet it notes that the cards are increasingly popular. It says consumers loaded $64.5 billion onto prepaid cards in 2012, up sharply from $28.6 billion in 2009.
Pew says the rising popularity of such cards “has not been matched by increased protection for consumers that would, for example, require uniform disclosures that clearly lay out fees, terms, and conditions.”
The disclosure box recommended by Pew would fit inside standard card packaging. Pew says the disclosure it’s proposing for prepaid cards is based on its checking account disclosure box. The checking account disclosure box has been adopted by 26 banks and credit unions, the group says, covering nearly 50 percent of domestic deposit volume.
See the full report.