Republicans Out To Screw The Poor On Pre-Paid Debit Cards

Republican legislators are looking to repeal a rule that would primarily affect one company in Georgia. Needless to say the effort is being spearheaded by a Georgia GOP Senator, David Purdue, and a Georgia Congressman, Tom Graves. The American Prospect reports:

The CFPB rule, scheduled to take effect in October, would provide safeguards for those who use prepaid cards, which are similar to debit cards but are preloaded with a designated amount of money by the cardholder. The rule would require providers to disclose hidden fees and protect against loss, theft, and unauthorized charges. The rule would also force prepaid-card companies to limit overdraft fees.

NetSpend, a division of the Georgia-based Total System Services (TSYS), is the only major provider of prepaid cards that has overdraft fees and, as such, is the biggest apparent beneficiary of the GOP move. The prepaid-card provider, which has lambasted the rule as “onerous,” announced in an October earnings call that it expected to lose $80 million to $85 million each year in overdraft fees, comprising 10 percent to 12 percent of its current revenue, as a result of the CFPB rule.

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