Today, the CFPB issued an Advance Notice of Proposed Rulemaking (ANPR) in which the CFPB states that it “intends to issue a proposal to extend the Regulation E protections” to general purpose, reloadable prepaid cards (GPR cards). In the ANPR, the CFPB requests public input on ten questions it has grouped into four categories: (1) regulatory coverage of GPR cards (2) GPR card fees and disclosures, (3) GPR card features, and (4) other information on GPR cards. According to the ANPR, the “comments, in conjunction with other outreach and analysis, will help the Bureau better understand and evaluate any potential consumer protection issues raised by the current design, marketing, and use of this product.”
In the regulatory coverage questions, the CFPB asks whether certain GPR cards should be excluded from Reg E and whether only certain aspects of Reg E should apply to GPR cards. Among the questions dealing with product fees and disclosures is one that asks whether pre-sale and/or post-sale disclosures should be required. With regard to product features, the CFPB wants input on credit, savings and credit reporting features offered by GPR cards.
We have previously expressed concerns about the position some consumer groups have taken on how the CFPB should regulate GPR cards under Reg E, which has included assumptions that certain GPR features are detrimental to consumers. We hope the ANPR indicates that the CFPB intends to take an open-minded approach in formulating its eventual Reg E proposal.
Comments on the ANPR will be due 60 days after the date the ANPR is published in the Federal Register. We are preparing a detailed legal alert on the ANPR and will provide a link to the alert in a subsequent blog post.