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prepaid debit cards

Why Should American Express Offer FDIC Insurance?

Adam Rust's picture

Posted March 25, 2013

When CEOs or prepaid card companies act to counter the voices of critics that call their products "second-tier bank accounts," one oft-cited defense has been that these cards have FDIC insurance. American Express' BlueBird card - otherwise a functional and affordable product - remains the lone holdout among major prepaid cards.

Any prepaid debit card can come with FDIC insurance as long as funds are placed into a bank account held in the name of the depositor. There is a cost, which the FDIC assesses based on the sum of deposits as well as the

Lessons from the La Raza Study on Prepaid Use by Latinos

Adam Rust's picture

Posted May 17, 2012

The National Council of La Raza has released a new study which offers some interesting insights into the use of prepaid debit cards by low-income Latinos. La Raza conducted a survey of 279 Latino tax filers at VITA sites in five cities in April 2010.

  • Top reason to get a prepaid card: "It seemed convenient."
  • Best place to buy a prepaid card: Wal-Mart
  • Top reasons to use a prepaid card: Pay bills, shop online, buy basic household items, or save money for an

Can Kicked: ex-Prepaid Issuer Palm Desert Bank Closed Down

Adam Rust's picture

Posted May 10, 2012

On April 27th, the FDIC shuttered Palm Desert National Bank and arranged through a mix of government subsidy and private investment that the bank's operations would be assumed by Pacific Premier Bank.  This presented perhaps the closest call to date for an event that might test the ability of the FDIC to deliver on its promise to repay depositors of a failed bank.

Prepaid deposits will not be in danger this time. Moreover, the current location of those

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