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Prepaid Debit Cards

The general purpose reloadable prepaid card can provide access to the banking system for households that might otherwise remain in the cash economy. Today, a GPR card can do almost everything that most people rely upon for a traditional transaction accounts. The cards demonstrate their growth both in terms of breadth of customer adoption and depth of customer use. With every metric – active cards, gross purchase volume, gross load volume – it seems that more and more people are choosing prepaid. With each quarter, publicly-traded prepaid card companies report that a higher share of their cardholders are facilitating a direct deposit to their account.

But to truly represent the interests of consumers, a strong regulatory framework should be applied to this product. Here is a link to my comment on the CFPB's proposed rules for prepaid cards

The prepaid debit card is one of the fasting growing product segments in banking.

 Given that prepaid debit cards have changed a lot in recent years and given that there is an expectation that they will continue to change rapidly in the future, one of the most important conversations about the product tends to be around future innovation. Front and center in the conversation of innovation is the question of how and if credit will be offered on a prepaid.

Adam Rust published a framework for how people should think about prepaid cards. The paper, entitled "8 Principles for the Reform of the Prepaid Card," was published immediately prior to the CFPB's hearing on prepaid cards in 2013.