April 07, 2014

CFPB tests prepaid card disclosures in California

April 8, 2014 – CFPB is testing model disclosure forms for prepaid cards in Los Angeles and is requesting comments on model forms in advance of rulemaking on the cards, which is expected to come later this spring.

CFPB plans to issue a uniform model for prepaid card disclosures in its rulemaking. The bureau addressed this in a blog post Friday, noting that current prepaid card companies' disclosures can be confusing and difficult to use for comparisons.

In the post, CFPB Senior Counsel Eric Goldberg offered examples of the information shown on different prepaid card companies' retail packaging. He explained that the bureau is developing a model for disclosure forms in order to standardize the information given by prepaid card companies so consumers can better compare and contrast what the companies offer.

CFPB conducted interviews with consumers in Baltimore last month and is now testing the model forms in Los Angeles. Goldberg requested comments from the public on the forms, specifically how understandable the forms' information on card costs are and what might be changed to make that information clearer.

Goldberg said CFPB plans to end its prepaid card model disclosure form testing by the end of this month.

NAFCU has met with staff at CFPB to discuss this issue and will continue to monitor any prepaid card activity for member credit unions.