Prepaid Cards

Use of reloadable prepaid cards - which can be used like credit and debit cards yet require no bank account or credit check - is surging. But the cards have a variety of drawbacks to consider. • Fees. Reloadable prepaid cards can come with a confusing array of fees - for activation, monthly maintenance, transactions, ATM cash withdrawals, balance inquiries, customer service calls, adding money to the card, inactivity and more. Each card's fees are different, so be sure to read the fine print.

Los Angeles Mayor Antonio Villaraigosa is pushing a plan to create an official city photo identification card that could double as a prepaid ATM card and help immigrants get access to banking services. The initiative could reduce crime because fewer people would have to carry cash, but critics say it's another ill-advised City Hall effort to accommodate illegal immigrants. The idea for the city ID card originated in his office, the mayor said, as part of previous efforts to help immigrants open bank accounts so they wouldn't become targets of crime.

WASHINGTON - The consumer financial watchdog is taking aim at reloadable prepaid cards, moving to regulate a fast-growing product that has become a popular alternative to checking accounts for lower-income Americans and a new source of fees for some banks. Consumer advocates have been pushing for regulation of the cards, which look like conventional credit cards or debit cards tied to bank accounts. But the prepaid cards are not required to offer the same consumer protections, such as clear disclosure of fees and caps on losses if stolen.

Retail giant Wal-Mart Stores Inc. and American Express Co. are teaming up to offer low-income shoppers a prepaid card. The companies are touting it as a more affordable alternative to debit cards. Called Bluebird, the card is aimed at "customers who are disillusioned or excluded by the rising cost of banking services," the two companies said in a statement Monday. The card, which has been tested since March, will be available next week online and in Wal-Mart stores. Bluebird, which functions somewhat like a checking account, can be used anywhere that accepts American Express cards.

U.S. Treasury officials are planning a crackdown on so-called prepaid cards, an increasingly popular payment instrument, to help safeguard the financial system from a surge in money laundering and other crimes including terrorist financing. The officials outlined plans for a regulatory clampdown on the instruments, also known as stored-value cards, at an anti-money-laundering conference in Hollywood, Fla.

Green Dot Corp., the largest U.S. provider of reloadable prepaid debit cards, jumped 22 percent after convincing buyers to pay more than the forecast price range for its $164 million initial public offering. Shares of Green Dot climbed $7.99 to $43.99 Thursday after management and stakeholders sold 4.56 million shares at $36 each on Wednesday, according to Bloomberg data. The Monrovia, Calif.-based company initially offered 3.85 million shares for $32 to $35 before increasing the size of the offering, its filings showed.

In a country with only 100,000 or so computers and a state-controlled media, Vo Dinh Thi's idea was almost revolutionary. Even his mother said he was foolish to throw his money away on such a hare-brained scheme. But Thi went ahead and remodeled his little cafe on Le Duan Street, two blocks from the abandoned U.S. Embassy. He taught his staff to make the best cappuccino in town and he put in three computers, offering customers something that is still rare in Vietnam: e-mail.

Local DWP customers annoyed by improper billing, large security deposits and the usual two-month payment interval have a new option, thanks to a pilot program implemented in the Valley this fall. The new metering system is a "pay-as-you-go" plan similar to prepaid phone cards. During a yearlong trial period, the DWP will install for free a small box in any residence. Customers can use the box to monitor electricity use during 24-hour and/or 30-day intervals.

Retail giant Wal-Mart Stores Inc. and American Express are teaming up to offer low-income shoppers a prepaid card, touting it as a more affordable alternative to debit cards. Called Bluebird, the card is aimed at “customers who are disillusioned or excluded by the rising cost of banking services,” the two companies said in a Monday statement. The card, which has been tested since March, will be available next week online and in Wal-Mart stores. Bluebird, which functions somewhat like a checking account, can be used anywhere that accepts American Express cards.

A computer network problem at AirTouch Communications has prevented some Southern California customers with pre-paid calling cards from making calls, the company said. The problem surfaced late Wednesday evening, when card owners were getting fast busy signals instead of reaching their party, said Andrew Colley, a company spokesman. AirTouch declined to say how many people were affected in Orange, Los Angeles, Riverside, San Bernardino and Ventura counties.

Retail giant Wal-Mart Stores Inc. and American Express are teaming up to offer low-income shoppers a prepaid card, touting it as a more affordable alternative to debit cards. Called Bluebird, the card is aimed at “customers who are disillusioned or excluded by the rising cost of banking services,” the two companies said in a Monday statement. The card, which has been tested since March, will be available next week online and in Wal-Mart stores. Bluebird, which functions somewhat like a checking account, can be used anywhere that accepts American Express cards.

The Federal Trade Commission is accusing a company that sells prepaid calling cards of using deceptive advertisements, which would violate federal law. DR Phone Communications makes claims in its advertisements that misrepresent the number of calling minutes its cards actually provide, the FTC said in an announcement Monday. The agency said the company, which has sales in the billions each year, targets immigrants and misleads them, many of whom depend on the cards "to call friends and family in other countries.

Use of reloadable prepaid cards - which can be used like credit and debit cards yet require no bank account or credit check - is surging. But the cards have a variety of drawbacks to consider. • Fees. Reloadable prepaid cards can come with a confusing array of fees - for activation, monthly maintenance, transactions, ATM cash withdrawals, balance inquiries, customer service calls, adding money to the card, inactivity and more. Each card's fees are different, so be sure to read the fine print.

WASHINGTON - The consumer financial watchdog is taking aim at reloadable prepaid cards, moving to regulate a fast-growing product that has become a popular alternative to checking accounts for lower-income Americans and a new source of fees for some banks. Consumer advocates have been pushing for regulation of the cards, which look like conventional credit cards or debit cards tied to bank accounts. But the prepaid cards are not required to offer the same consumer protections, such as clear disclosure of fees and caps on losses if stolen.

The gig : Steven W. Streit is founder and chief executive of Monrovia-based Green Dot Corp., the nation's largest provider of prepaid debit cards. Customers, mostly people without bank accounts, buy the cards at retail outlets, load them with cash or direct-deposit paychecks and use them like bank-issued plastic. They are branded under the Green Dot name and also branded for Wal-Mart Stores. Past life : Streit was a disc jockey (Streiter with the Heater; the Ayatollah of Rock 'n' Rolla)

Hoping to say goodbye to paper tax-refund checks, the federal government launched a pilot program to let some people receive their money on a debit card. Next week, the Treasury Department will send letters to 600,000 low- and moderate-income taxpayers offering them the option of signing up for a special MyAccountCard Visa prepaid debit card. Green Dot Corp. in Monrovia, the nation's largest prepaid debit card company, got the nod to provide the cards and manage the pilot program, the Treasury said Thursday.

The Federal Communications Commission has ruled that issuers of prepaid calling cards must pay connection fees and help subsidize phone service in rural areas. AT&T Inc. will have to repay the $553 million in access fees -- charges paid to other carriers to connect calls -- and Universal Service Fund payments that its predecessor, then known as AT&T Corp., had withheld on phone calling cards.

Per-minute Internet access, vanquished by the overwhelming success of unlimited-use pricing plans, is making a comeback of sorts in the form of prepaid Internet cards. Sprint this month will begin selling prepaid Internet access cards that function much like prepaid phone cards, with the user paying in advance for a set amount of online time through a nationwide toll-free number or a list of local access numbers.

Gift cards are popular stocking stuffers because they take some of the guesswork out of gift giving but still seem more thoughtful than slipping cash into an envelope. From Home Depot to Best Buy to Nordstrom, retailers offer a card for nearly every occasion and person. But an Internet company says it's tapping an overlooked market with a one-of-a-kind card to appeal to shoppers interested in a different kind of giving. Causes, which helps donors link up with charities online, has teamed up with gift card marketer Blackhawk Network to sell $25 and $50 prepaid gift cards in 800 Safeway and Vons supermarkets in California.

Financial service firms have struggled for years to reach the estimated 30 million lower-income households that make little use of traditional banks. Green Dot Corp. of Monrovia thinks it's found a good way, and the stock market Thursday resoundingly concurred, valuing the newly public, 11-year-old firm at $1.8 billion after the first day of trading in its shares. The company markets so-called prepaid debit cards, which look and act like bank debit cards. But prepaid cards don't pull money out of your checking account.