Prepaid cards now offer more competition with new savings options
by. Tom
A variety of companies that do not qualify as banks or credit unions have started to offer prepaid debit cards. American Express announced a new deal with Wal-Mart this week that will give low-income customers access to the American Express Bluebird card, which means low-income customers can have access to credit card features like smartphone deposits, mobile banking, and roadside assistance.
Bluebird has gotten some close scrutiny from financial rivals but it’s gaining popularity with consumers. The consumer watchdog organization, the Consumer Financial Protection Bureau, is preparing restrictions on prepaid cards and says it has concerns about high fees and less than adequate disclosures.
While products like Bluebird clearly compete with conventional checking accounts and ATM cards, other new prepaid products are emerging to take on other banking sectors. Social Money, a start-up developing white-labeled products, has just announced CorePro, an FDIC-insured pre-paid card product that integrates savings with online and mobile solutions.
CorePro is similar to Social Money’s online savings system, SmartyPig, with savings goals and goal management. This is an API-driven account that helps consumers save and costs issuers $0.39 per month per account.
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