ABA was commenting on the CFPB’s advance notice of proposed rulemaking (ANPR) to seek public feedback on how to ensure that prepaid cards’ funds are secure and their terms and fees are transparent.
Issuers of general purpose reloadable prepaid cards (GPR cards) and associated card payment networks have voluntarily applied Reg E protections with minor modifications for some time, ABA said. Other regulations—such as Reg DD and Reg CC—may also apply, depending on the card’s design and features.
“Thus, as a practical matter, these cards are already part of the federal regulatory scheme … ,” ABA said. While the CFPB applies Reg E to GPR cards, the association, among other things, asked the bureau to recognize the variety of GPR card models and provide flexibility on the timing, content, and format of disclosures.
We [also] stress that the market and consumers should determine GPR card features, pricing and terms, and that the bureau should not directly or indirectly regulate their prices and features. The bureau should also coordinate other consumer protection laws that might apply to GPR cards and rely on existing rules, where appropriate, to promote consistent, uniform disclosures and rules.Read the letter.
Read the ANPR.
For a compendium of CFPB resources and analysis, see ABA's CFPBureau Watch