Prepaid cards are prepaid – a safe way to control spending for consumers who have had trouble with overdraft fees, have blemished credit, and may have lost their bank account. Except for prepaid cards sold by payday lenders. The largest payday lenders sell prepaid cards with unusual features that enable payday loans and profit from them.
Most mainstream prepaid cards cannot be used to secure a payday loan. But payday lender prepaid cards allow payday lenders to take advance authorization to debit the card on the consumer’s payday.