People applying for a Chase Liquid prepaid card are the first to get a peek at the new disclosure form that aims to make terms and conditions clearer and fee schedules easier to understand.
The new form, created by the Pew Charitable Trusts, was prompted by a push by lawmakers to make prepaid fee disclosures clearer. Senator Mark Warner of Virginia introduced the legislation. “Prepaid cards are one of the fastest-growing segments of the digital economy, but aren’t required to have the same kinds of consumer protections as other types of credit cards,” said Senator Warner. His legislation proposed making the new disclosures a standard across the prepaid card industry.
Prepaid cards often have fees for things such as ATM withdrawals, loading money onto the card, monthly fees, activation fees, card replacement and more. But since fee disclosures look different for different prepaid cards, these fees may not always be clear to consumers. The Pew Foundation researched prepaid card fee disclosures and found that fees were difficult to understand, according to Susan Weinstock, director of Pew’s safe checking research department.
This is not the first time the Pew Foundation has sought to make financial institutions’ terms and conditions disclaimers clearer for consumers. Pew overhauled Chase Total Checking’s disclosure forms in December 2011.
Prepaid card fees vary
Prepaid cards, also called general purpose reloadable debit cards, are cards that customers load money onto up front and can add money to as needed. They have become increasingly popular as alternatives to credit cards and checking accounts. But fees vary greatly. Adopting a uniform disclosure box for prepaid cards may make it easier for customers to compare cards and make an informed decision about which card to purchase.
The Chase Liquid card charges customers a monthly fee of $4.95, but transactions and reloading are fee-free. The card is available at Chase bank branches. The new disclosure forms will be available online in March but won’t be in branches until June.