Via WSJ (paywall), CFPB now requires prepaid cards and digital wallets to offer consumer protection from fraud and erroneous or unauthorized charges. The change was announced quite some time ago, and finally enforced this week.
The new rule covers reloadable prepaid cards and digital or mobile wallets like Venmo and Paypal. It does not cover non-reloadables, such as Visa gift cards. I don’t think reloadable store gift cards (to a specific merchant) are covered either.
A win for consumers. Some of us have various forms of prepaid cards for various forms of manufactured spend, and these are now required to cover fraud. Just about everyone has a Paypal or Venmo or Square account. We wrote how Paypal Accounts now has a Separate ‘Cash Account’ to Send and Withdraw Money which is meant to comply with the new regulations.
