CFPB Seeks Public Comment on Proposed Changes to Prepaid Rule
06/20/17 – The Consumer Financial Protection Bureau (CFPB) has announced that it is seeking public comment on proposed updates to its prepaid rule.
According to the CFPB, prepaid accounts are among the fastest growing consumer financial products in the United States, usually purchased at retail outlets or online. The total dollar value loaded onto these prepaid cards is expected to nearly double to $112 billion by 2018.
The CFPB finalized the prepaid rule in October 2016, requiring financial institutions to limit consumers’ losses when funds are stolen or cards are lost, investigate and resolve errors, give consumers free and easy access to account information, and provide protections if credit is offered.
The CFPB is seeking public comment on several adjustments to the prepaid rule. The proposal addresses concerns raised by prepaid companies about unanticipated complexities with certain aspects of the rule that were not fully addressed in their comment letters on the 2014 prepaid proposal. The proposed changes would adjust error resolution requirements and provide more flexibility concerning credit cards linked to digital wallets.
The Bureau has also released an updated version of its small entity compliance guide for the prepaid rule. The update reflects the recent effective date delay, and clarifies other issues for which the industry has raised questions or suggested might be unclear.