The Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Department of the Treasury, is providing administrative relief to the prepaid card industry as the deadline for compliance with the "prepaid access" final rule counts down. The final rule, which requires prepaid card businesses to comply with certain Bank Secrecy Act regulations, was scheduled to go into effect Sept. 27, 2011, but prepaid card providers have been given until March 31, 2012, to reach compliance with some of the mandates.
FinCEN made this decision following comments it received from the industry that achieving compliance with the final rule by Sept. 27 would be a challenge, given the demands of the business cycle as the holiday shopping season approaches.
The American Payroll Association said legislation working its way through the California legislature would require employers that provide prepaid payroll cards to its employees to also provide free banking services. The APA believes such a requirement goes "far beyond" what is obligated for any other payroll payment method.
A payroll card bill (AB 51) passed the California Assembly in June 2011 and is being considered by the California Senate as SB 931. "Ultimately, it is widely believed in the industry that the increased costs and administrative burdens imposed by SB 931 will discourage the use of paycards in California because they will outweigh the benefits the cards provide to employers, thereby denying the benefits to employees as well," the APA said.
Evolution Finance Inc.'s credit card comparison website CardHub.com conducted research into the fees that prepaid card providers charge consumers. In Prepaid Cards Report – 2011, CardHub.com concluded that NetSpend Holdings Inc. cards were the most expensive from a fee standpoint, while Green Dot Corp. and American Express Co. cards were the least expensive.
In other news, Green Dot joined the Payment Card Industry Security Standards Council as a participating organization in the development and improvement of data security worldwide.
Safeway Inc. subsidiary Blackhawk Network reported AccountNow Inc., Galileo processing Inc., NetSpend, Precash Inc. and Ready Credit Corp., joined Blackhawk's REloadit Network.
Pune, India-based payment processor ElectraCard Services became a finalist for Prepaid Awards 2011 in the Best Prepaid Service Provider category. ECS said it is MasterCard Worldwide's preferred processor of prepaid cards in Africa and in the Asia-Pacific and Middle East regions.
At the TechCrunch Disrupt SF 2011 conference held Sept. 12 to 14, Openbucks unveiled its Gift Card Payment Network which allows closed-loop retailer gift cards to be used as payment for online games and other purchases at e-commerce sites.
Loyalty and gift card network provider SparkBase received orders for over 3,000 Paycloud sensors that render POS devices capable of accepting mobile proximity payments. The sensor works in conjunction with the downloadable Paycloud app to transform smart phones into mobile wallets that enable rewards and discount offers. SparkBase expects the sensors to be up and running at merchant locations by the fourth quarter of 2011.
VendTek Systems Inc., a Vancouver, British Columbia-based prepaid card software developer and program manager, through its Now Prepay division, allocated over $1.5 million via its prepaid card operation in Brazil. VendTek has about 900 retail locations in its network in the South American country, primarily in the province of Sao Paulo.
Blackhawk Network entered a distribution agreement with NetSpend to offer its Visa-branded, reloadable prepaid cards via the gift card malls at over 3,000 retail locations beginning November 2011. Currently, NetSpend cardholders can reload cards by purchasing REloadit packs.
Campus card program manager CardSmith LLC integrated Pharos Systems International's Uniprint service to allow cardholders to print out bills and have those bills applied to campus card accounts in real time.
Via its Hampshire, England-based division, Atlanta-headquartered prepaid card distributor InComm signed an agreement with Manor AG, a department store chain in Switzerland, to provide digital content game cards in the Western European country. InComm said the rollout marks the first time the cards were made available in Switzerland.
Meta Payment Systems, the prepaid card program management arm of Meta Financial Group Inc., selected Midco Connections to offer customer care services through its Sioux Falls, Iowa-based contact center.
Cashless parking payment provider Parkmobile USA Inc. selected the Citigroup division Citi Prepaid Services to offer mobile payment services to Parkmobile customers. The service is designed to allow users to pay for parking via mobile phone, without having to stop at pay stations to park at airports, train stations and ferry terminals.
VendTek inked a deal with mobile airtime facilitator ezetop LLC to offer international mobile phone top up services in Canada. The addition of VendTek's Now Prepay network to ezetop's distribution network is expected to allow customers to purchase and reload prepaid cards at 15,000 locations in Canada.
Through its prepaid card division epay, international payment processor Euronet Worldwide Inc. completed the acquisition of Germany-based prepaid voucher and incentive provider cadooz Holding GmbH. Financial details of the purchase were not revealed.
Simon Curtis joined U.K.-based YESpay as Senior Vice President of European Strategic Sales & Business Development. Curtis brings over 20 years of experience in consulting and information technology systems delivery.
Sausalito, Calif.-headquartered prepaid card provider The Tyburn Group Inc. selected Deborah S. Davis as Chief Operating Officer. Davis's background includes management positions at Hewlett-Packard Development Co. LP, Logitech, VeriFone Inc. and Green Dot.
UniRush LLC hired Rob Rosenblatt as Chief Executive Officer for prepaid card subsidiary RushCard. Rosenblatt joins UniRush from JPMorgan Chase & Co.'s Chase Card Services, where he served as General Manager for Customer Loyalty, Mobile Commerce and Innovation.
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