American Express Co. (AXP) is adding paper checks and deposit insurance to the Bluebird prepaid card it debuted last year with Wal-Mart Stores Inc. (WMT) as it faces competition from other firms pitching alternatives to big-bank checking accounts.
Best known for its high-end charge and credit cards, American Express rolled out the Bluebird product in October with Wal-Mart to go after the millions of U.S. consumers it says have been hit by rising account fees at large retail banks.
Until now, the Bluebird card lacked paper checks and was not covered for losses by the Federal Deposit Insurance Corp. The lack of FDIC coverage prevented customers from having government payments like Social Security, military pay and tax refunds deposited directly to the accounts. Federal regulation requires that direct deposits of such payments be made into FDIC-insured accounts.
“What we’re really trying to do is provide alternatives to traditional banking services,” said Dan Schulman, president of the enterprise growth group at American Express.continue reading »