Sen. Mark Warner (D-Va.) introduced a new bill yesterday which requires banks to fully disclose fees and charges associated with the use of prepaid cards. The legislation would also require the Consumer Financial Protection Bureau to standardize the required disclosures since issuers of prepaid cards currently are not subject to rules requiring the same level of consumer information and disclosure that is required for issuers of credit cards and gift cards. The use of prepaid cards is growing rapidly, especially among young people without credit history and over $670 billion is loaded onto cards each year. Senator Warner believes greater transparency of fees is needed in this sector since some issuers of prepaid cards charge activation and maintenance fees and impose fees for checking the account balance, overdrafts and inactivity without disclosing this information to consumers.
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