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Table of Contents

Lead Story

Fintechs: friends or foes?

Patti Murphy


Industry Update

News Briefs

Selling Prepaid

ETA sets forth recommendations on prepaid rule

Mixed forecast for open-loop prepaid cards


Why every MLS needs to know how to cross-sell

Barry Davis

Don't leave alternative payments on the table

Dale S. Laszig
DSL Direct LLC

A solid niche for cash advance products

Steven Feldshuh
Merchants' Choice Payment Solutions East


Street SmartsSM:
Never sell a merchant account again

Aaron Nasseh
Finical Inc.

Portfolio rationalization

Adam T. Hark
Preston Todd Advisors

The real reason so many newbies fail

Jeff Fortney
Clearent LLC

Company Profile

Apogee Payment Systems LLC

New Products

Automated, out-of-the-box cash discount program

XeroPoint. Cash Discount Program
Processing Solutions Inc.


Persuasion in practice


Letter from the editors

Readers Speak

Tapping into your super-user base

Resource Guide


A Bigger Thing

The Green Sheet Online Edition

August 28, 2017  •  Issue 17:08:02

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ETA sets forth recommendations on prepaid rule

The Electronic Transactions Association went to bat for the prepaid sector as part of its ongoing advocacy efforts. In response to the Consumer Financial Protection Bureau's June 2017 request for comments on proposed amendments to prepaid account rules under the Electronic Fund Transfer Act and the Truth in Lending Act, Regulations E and Z, respectively, the ETA sent comments in a letter to the CFPB.

The association offered several recommendations to the bureau. Among them were to:

In its letter, dated Aug., 14, 2017, the ETA also recommended the proposed exception apply in full to business arrangements and affiliate issuers so long as all conditions are met. This includes imposition of the 30-day waiting period for covered separate credit features.

Finalized but not finished

The prepaid rule in question was finalized in October 2016 and applies specific federal consumer protections to broad swaths of the prepaid market. It requires financial institutions to limit consumer losses; investigate and resolve errors; offer free, easy access to account information; and provide protections.

The CFPB noted that prepaid accounts are among the fastest growing consumer financial products in the United States, usually purchased at retail outlets or online. The amount consumers put on "general purpose reloadable" prepaid cards grew from less than $1 billion in 2003 to nearly $65 billion in 2012. The total dollar value loaded onto these prepaid cards is expected to nearly double to $112 billion by 2018. Prepaid accounts may be loaded with funds by a consumer or by a third party, such as an employer. Consumers generally can use these accounts to make payments, store funds, withdraw cash at ATMs, receive direct deposits, or send money to others.

The amendments for which the CFPB seeks input pertain to adjusting error resolution requirements, providing more flexibility concerning credit cards linked to digital wallets, as well as making "minor adjustments and clarifications to aspects of the prepaid rule that prepaid companies have asked questions about or told the Bureau are presenting obstacles to implementation," the CFPB stated.

The CFPB also released an updated version of its small entity compliance guide for the prepaid rule. That update reflects the recent effective date delay, and also includes clarifications on several other issues for which industry has raised questions or suggested might be unclear.

The revised guide, which includes a summary of the updates, can be found at

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

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