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Federal Reserve Mandates New Prepaid Card Rules
The deadline to comply with new regulations for Prepaid Cards is fast approaching. The Fed is set to begin enforcement on August 22, 2010. Areas of mandated change include disclosure, fee structures, card expiration dates, and related areas. These mandates cover gift certificates, store gift cards, and general use prepaid cards.
The Opticard system can support all new regulations and our representatives are happy to assist you in understanding, adjusting and implementing the new rules. Below are the provisions for the Fed’s prepaid card rules as provided by Digital Transactions News in their article “Fed Surprises Prepaid Industry with Tight Deadline for Compliance." Please refer to your State Escheatment Laws for more information regarding your local area. A summary of the regulations follows:
· Dormancy, inactivity, or service fees may be assessed only for a card or certificate that has had at least one year of inactivity. There can be no more than one such fee charged per month. Consumers must be given clear and conspicuous disclosures about fees.
· Service fees subject to the restriction above include monthly maintenance fees, balance-inquiry fees, and transaction-based fees, such as reload fees, ATM fees, and point-of-sale fees.
· Expiration dates must be a minimum of five years after the date a certificate or card is issued or the date funds are last loaded. The expiration date restrictions apply to a consumer’s funds, not to the certificate or card itself
· Fees are prohibited for replacing an expired certificate or card, or for refunding the remaining balance, if the underlying funds remain valid.
Contact the Opticard team if you have additional questions 1-877-331-2900
