Overdraft fees on payday lender prepaid cards still permitted but hopefully on the way out
(WASHINGTON) The final rules released by the Consumer Financial Protection Bureau (CFPB) today will vastly increase protections for prepaid cards, according to advocates at the National Consumer Law Center (NCLC). While the rules do not go as far as many wished, advocates expressed hope that the prepaid industry would completely eliminate overdraft fees so that all cards would truly be “prepaid.”
“The rules bring prepaid cards out of the shadows, with protections that in many ways are stronger than those for traditional bank accounts,” said Lauren Saunders, associate director of the National Consumer Law Center. “Consumers will have protection from fraud, costs will be more transparent, and dangerous overdraft fees will be curtailed, but unfortunately not eliminated,” she explained.