PNS Daily Newscast - July 17, 2019 

The House votes to condemn President Trump’s attacks on women of color in Congress as racist. Also on our Wednesday rundown: A new report forecasts big losses for some states if the ACA is repealed. And a corporate call to flex muscle to close the gender pay gap.

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Hidden Fees on Prepaid Credit Cards Can Surprise

Hidden fees on prepaid credit cards often can cost more than the card. (Jerry Oster)
Hidden fees on prepaid credit cards often can cost more than the card. (Jerry Oster)
October 24, 2016

FARGO, N.D. -- Consumer groups are praising new rules on prepaid credit cards just released by the feds. The regulation, issued by the Consumer Financial Protection Bureau, goes into effect next fall and will make prepaid card issuers follow many of the same rules that apply to credit cards.

Graciela Aponte-Diaz, director of policy with the Center for Responsible Lending, said prepaid cards often are used by low-income families who may not have a bank account. But the cards can come with hidden fees, something that will change with the new "know as you go" provision.

"It ensures that the prepaid card issuer lets the consumer know what the exact fees are, if there's a monthly fee, if there is a fee when you go to the ATM,” Aponte-Diaz said. "Is there a fee when you reload the card with cash?"

The new rules would force card issuers to underwrite a consumer's ability to repay a loan on their prepaid card and would impose limits on companies' rules for repayment, in an effort to make the process more fair.

But Aponte-Diaz said she thinks the rule doesn't go far enough, and that she would have liked to see the rule ban overdraft fees entirely if people spend more than the face value of the card.

"As the rule is written now, someone can use their card and overspend and they'll be charged fees for that,” Aponte-Diaz said.

The rules also state that when errors are found, the card issuer will be required to open an investigation and give consumers a replacement card, instead of freezing their funds.

Jerry Oster, Public News Service - ND