Using Paycards for Employees? New Regulations from CFPB Are Coming

WASHINGTON, D.C. – In October, the Consumer Financial Protection Bureau (CFPB) finalized new federal consumer protections for prepaid account users. The new rule requires financial institutions to limit consumers’ losses when funds are stolen or cards are lost, investigate and resolve errors, and give consumers free and easy access to account information.  The Bureau also finalized new “Know Before You Owe” disclosures for prepaid accounts to give consumers clear, upfront information about fees and other key details. Finally, prepaid companies must now generally offer protections similar to those for credit cards if consumers are allowed to use credit on their accounts to pay for transactions that they lack the money to cover.

Prepaid accounts are among the fastest growing consumer financial products in the United States, usually purchased at retail outlets or online. The amount consumers put on “general purpose reloadable” prepaid cards grew from less than $1 billion in 2003 to nearly $65 billion in 2012. The total dollar value loaded onto these prepaid cards is expected to nearly double to $112 billion by 2018. Prepaid accounts may be loaded with funds by a consumer or by a third party, such as an employer. Consumers generally can use these accounts to make payments, store funds, withdraw cash at ATMs, receive direct deposits, or send money to others.

Some of the protections for consumers include:

  1. Free and easy access to account information;
  2. Error resolution rights;
  3. Protections for lost cards and unauthorized transactions
  4. Standard, easy-to-understand, upfront information (disclosures)
  5. Publicly available card agreements.

The new rule will generally apply to prepaid accounts starting Oct. 1, 2017, though the requirement for submitting agreements to the Bureau takes effect in October 2018. The final rule includes other accommodations in certain situations.  Read the rule here.  Check with your prepaid payroll card vendor to see how these new rules will impact your pay card program.

Consultstu LLC provides fractional HR services to small/mid businesses to lower operational costs, improve business processes and comply with workplace regulations.  We deliver customized HR solutions that provide protection from expensive mistakes and strategies to improve workplace results. Call us at 727-350-0370 or visit http://www.consultstu.com

HR Categories
1095C form300 Log401(k)8(a)(1)AccommodationAffordable Care ActAmericans with Disabilities ActARPABackground screeningBilingualBonusesBusiness ExpensesCannabidiol (CBD)CDLCFPBChild laborCHIP NoticeChristmas partyClearinghouseCOBRACommercial Motor Vehicle DriverCompany CultureCompensationConcerted ActivityConstructionContagious diseaseCoronavirusCraft BeerDepartment of LaborDisabilitiesDiscriminationDOTDownsizing and RestructuringDress CodeDriversDrug and AlcoholDrug Free WorkplaceE-VerifyEEO-1 FormEEOCEmployee benefitsEmployee HandbookEmployee IllnessEmployee InjuryEmployee MisconductEmployee PoliciesEmployee RecognitionEmployee RightsEmployment PosterERISAEssential functionsExecutive OrderExempt EmployeeExit InterviewFair Credit Reporting ActFair Labor Standards ActFall ProtectionFederal ContractorsFFCRAFinancial Well-beingFitness for DutyFlorida rulesFluencyFMCSAFMLAForm 5500Form W-4Fractional HRGender Non-conformityGeneral HR QuestionsGoal SettingGroup Health InsuranceHarassmentHiringHolidaysHR ComplianceHR CostsHR ResourcesHR softwareHuman ResourcesHuman TraffickingI9 FormImmigrationIndependent ContractorIndividualized AssessmentInjury StatisticsInsuranceInvestigationsIRSJob DescriptionJob PostJoint EmployerLeave of AbsenceLeaving a PEOManagerMedical ExamsMedical MarijuanaMinimum WageNational OriginNew HireNLRBNo-match letterOnboardingOpioidsOSHAOutplacementOvertimePaid LeavePay CardsPay or PlayPaycheck Protection ProgramPayrollPayroll Protection ProgramPerformance Improvement PlanPerformance ReviewPersonnel FilePost offer medical questionnairePostersPregnancyReasonable AccomodationRecall LetterRecord KeepingRecruitingReligionRestaurantsResumeRetaliationRetentionRetirementRewardsRisk ManagementSafetySalaried employeesSBASection 7 RightsSelf AppraisalSick LeaveSMART goalsSocial MediaSocial Security cardStart upTaxesTemporary EmployeeTerminationTipped EmployeesTitle VIITPD BenefitsTrainingUnemploymentUniformsUSCISVaccinesW2W4Wage and HourWellness programWork from HomeWorkers CompensationWorkplace MonitoringWrap Plans
Show All Categories
Show Less Categories
Archives
Need on-going HR support?
We have affordable HR retainers that offer a unique alternative to full HR outsourcing or the hiring of a full time HR employee. We design unique solutions to match your business strategy and budget. We have a proven track record of helping companies from many industries. We listen and probe to understand your needs and goals, before we offer recommendations and realistic solutions.
Contact Us Now