The Consumer Financial Protection Bureau today announced new regulations that will strengthen consumer protections for prepaid accounts and cards.
The new rule, which runs nearly 1,700 pages long, will also apply to mobile wallets and person-to-person payment products.
Prepaid accounts are an alternative to traditional checking accounts, particularly for those who are unbanked. Typically, a third party, such as an employer, will load funds onto the prepaid card, and the user can make purchases, pay bills or withdraw cash with it.
Prepaid cards have been a booming business. About 23 million individuals use them regularly, according to the Pew Charitable Trusts. In 2012, customers loaded nearly $65 billion onto re-loadable prepaid cards, up from less than $1 billion in 2003, according to the Consumer Financial Protection Bureau.