The Consumer Financial Protection Bureau is considering whether to impose its regulatory authority on states with gift card laws that are inconsistent with federal gift card laws. Specifically at issue are regulations in Maine and Tennessee that allow the states to seize funds on unused gift cards two years after the cards have been inactive; federal law generally imposes an expiration date of five years on cards, according to the CFPB.
The bureau said if state law is inconsistent with federal law, then federal law preempts state law. However, federal law does not preempt state law if it is determined that state law offers greater consumer protection than federal law. The CFPB said it is obligated by the Electronic Fund Transfer Act to evaluate whether state law is inconsistent with federal law and which legal jurisdiction affords consumers more protection.
The CFPB issued a public notice asking for comment on the issue. Financial services companies have until Oct. 16, 2012, to comment. The CFPB's public notice can be accessed at:
In a July 2012 report to Congress, the Federal Reserve said the government's Supplemental Nutrition Assistance Program, formerly called the Food Stamp Program, disbursed nearly $73 billion in benefits in 2011, with all of those funds loaded onto prepaid cards. Out of a total of over $149 billion in government benefits disbursed last year, 67 percent were issued on prepaid cards, according to the Fed.
Prepaid cards were used in 158 programs across 36 states. Of 26 unemployment benefits programs, representing nearly $39 billion in funds disbursed, 37 percent of total funds were loaded on prepaid cards. Furthermore, funds disbursed for the Temporary Assistance for Needy Families program were "almost exclusively" disbursed via prepaid cards, the Fed reported. In contrast, prepaid cards were used to disburse only approximately 1 percent of government payroll program funds, the Fed added.
Buffalo, N.Y., paid out $32,140 in prepaid cards to people who turned in a total of 746 guns at the city's fifth annual Gun Buyback program held Aug. 18, 2012. The program is part of Buffalo's effort to remove weapons from the streets. "This year's gun buyback will continue to assist in our efforts to reduce the overall crime rate in the City of Buffalo," said Buffalo Mayor Byron W. Brown.
The program took place at seven Buffalo area churches and was financed by funds seized from illegal drug sales and other criminal activities in the city. Prepaid cards were issued in amounts ranging from $10 for non-working or antique guns to $100 for assault weapons, with rifles and handguns yielding $50 and $75 respectively.
The city reported it has swapped 2,951 guns for over $100,000 in prepaid cards since Buffalo instituted the program in 2007. The initiative is one of several anti-crime measures being implemented throughout the city.
The American PrePaid Phonecall Association opened its doors to new members. At its Aug. 6, 2012, board of directors meeting in Las Vegas, the APPPA decided to accept new membership applicants. Prepaid phone call providers interested in joining the association should contact APPPA Executive Director Gene Retske at 202-370-7600 or firstname.lastname@example.org.
Eleven employees of gift card manufacturer CPI Card Group graduated from an accreditation program run by the International Card Manufacturers Association. The Advanced Card Education program provides instruction in card manufacturing and processes based on eight key areas: PVC/plastics, inks, adhesives, printing, collation, lamination, die-cutting and standards/testing.
Dunkin' Donuts introduced The Dunkin' App, a mobile application that allows users to purchase the Virtual Dunkin' Donuts Card, an e-wallet prepaid card that functions with quick response codes. The app doubles as a Dunkin' Donuts location finder and virtual menu.
National Basketball Association legend Earvin "Magic" Johnson is on an eight-city What Inspires You? Tour to educate people about positive financial management and promote the MasterCard-branded, OneWest Bank-issued Magic prepaid card. The tour began July 28, 2012, in Atlanta and moved on to Oakland, Calif., in early August.
In the Ninth Annual U.S. Open-Loop Prepaid Cards Market Assessment and Prepaid Industry Overview, Mercator Advisory Group said the open-loop prepaid market in the United States grew to $184.1 billion in 2011, up 24 percent from $148.4 billion in 2010. "The growth has been driven by the cash access and government categories; however, the future growth of the market could be hurt by potential regulatory actions," said Tim Sloane, Director of Mercator's Prepaid Advisory Service and author of the report.
Prepaid calling card provider Vesta Corp. expanded its recharge portal, Prepaid.com, by adding recharge airtime services to several new countries, including Brazil, the Dominican Republic, the Philippines and Jamaica. Vesta said it plans to support over 200 mobile operators in 80 countries by the end of 2012.
TransCard LLC chose customer analytics firm Buxton to assist the prepaid card processor in identifying specific families within a financial institution's "branch footprint" who would be suitable for prepaid products. The types of customers TransCard seeks to identify include minority homes and homes with teens and college students.
Processor i2c Inc. joined with money transfer provider The Western Union Co. to process payments on The Western Union Gold Prepaid Card. The card was launched in the Philippines using i2c's global processing platform, MCP.
London-based corporate remittance processor Payza joined with electronic identity verification solution provider Intelligent ID to enhance Payza's ability to perform real-time identity verification of its U.K. cardholders.
Sales organization Syncron Payment Systems will market Global Payout Inc.'s general purpose reloadable prepaid card, MoneyTrac. Syncron expects 1,000 new cardholders per month will activate the Discover Financial Services-branded cards. Syncron will also market its credit repair services to a select database of MoneyTrac cardholders.
Green Dot Corp. inked a deal with student loan provider Sallie Mae Inc. to manage and distribute the My Flex Card by Sallie Mae, a MasterCard-branded financial aid refund card. The card is promoted as a low-cost option for students to receive financial aid funds left over after tuition is paid.
In-game payment optimization specialist Xsolla teamed with Openbucks Corp. to extend the Openbucks Gift Card Payment Network to Xsolla's network of game developers. The integration allows gamers in the United States and Canada to pay for in-game items and subscriptions with new or unused gift cards.
U.S. Bank N.A. entered the large commercial truck market with the acquisition of TransCard's Class 7-8 fuel card network, including its product technology and nationwide acceptance network. U.S. Bank's Over The Road Card features a dual wallet that combines charge card functionality with a MasterCard-branded prepaid account.
Financial holding company The Bancorp Inc. acquired several assets from Gibraltar-based prepaid program management provider Transact Network, including the MyCardData technology platform and the Easybuy website.
U.K.-based prepaid voucher provider Ukash hired two new senior managers: James Allum and Jon Fox. Allum was appointed Commercial Director. Fox joined Ukash as Sales Director.
The Green Sheet Inc. is now a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals. Click here for more information.
Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.Prev Next