CFPB Further Delays Prepaid Proposed Rule

Industry anticipation continues to grow as the Consumer Financial Protection Bureau (CFPB) announced that its general-purpose reloadable (GPR) prepaid card proposal will now be issued by the end of the summer. Although this delay is not unexpected, the CFPB indicated as recently as last month that it would publish a proposed prepaid card rule no later than June 2014. Nonetheless, Director Richard Cordray has told congressional committees that a proposed rule will be ready by the end of the summer.

SMOKE, BUT NO FIRE (YET) -

Despite the delay, the CFPB has offered some insight into the substance of the prepaid card regulations. For example, last week Director Cordray told the House Committee on Financial Services that the packaging for most prepaid cards is too small to provide the types of disclosures that the CFPB believes consumers need. In a March blog post, the CFPB released model disclosures for prepaid card packaging being considered by the CFPB in connection with its anticipated rulemaking. The CFPB intends the model disclosures to enable consumers to make side-by-side—or, in the Director’s words, “apples-to-apples”—comparisons.

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