Though it’s been a point of concern with employee-rights advocates for years, the use of prepaid debit cards as a substitute for traditional payroll checks is finally getting attention from the powers that be, with the New York state attorney general’s office investigating the practice at some of the nation’s largest employers. [More]
The notion behind an overdraft fee — in which a bank customer is charged a penalty for overdrafting his account — is twofold: To incentivize consumers to pay attention to how much money is in their accounts, and to allow the bank to recoup any money it lost by covering the overage. But a new report claims that these fees have become such a profit center for banks that it’s now in their interest to push account-holders with low-balance bank accounts toward overdrafting. [More]
We’ve been warning readers for years against “refund anticipation loans,” where tax preparers like H&R Block and Jackson Hewitt give you a pre-paid debit card now loaded with your expected return (minus fees and interest). And yet, these cards have continued to appeal to some lower-income taxpayers who don’t have bank accounts for direct-deposit of their returns. Now the federal government is providing these people with an alternative — a debit card that will accept the direct deposit.