Sen. Rounds Calls on CFPB for Cost-Benefit Analysis for Benefits Cards
As the CFPB prepares to release its final rule on prepaid accounts—expected this month—U.S. Senator Mike Rounds (R-S.D.) is urging the agency to conduct a cost-benefit analysis on how the rule would affect government benefits cards and potentially increase taxpayer costs. In a Feb. 24 letter to the CFPB, Sen. Rounds specifically takes issue with the disclosure requirement for benefits programs to include the statement: “You do not have to get your payments on this prepaid card. Ask about other ways to get your payments.” Despite consumer protections on benefits cards, Sen. Rounds suggests that the statement could discourage prepaid card use, leading recipients to request more expensive check payments. Sen. Rounds first raised the issue with Director Cordray during a July 2015 Senate Banking Committee hearing. Cordray later reported to the senator that no cost-benefit analysis related to government cards had been conducted.
“Before the Bureau releases its Final Rule,” Sen. Rounds writes, “please conduct a detailed cost-benefit analysis that gauges the impact of the Prepaid Account NPR on federal entities and programs that utilize prepaid card products as an option for Americans to receive their federally mandated benefits specifically examining the increased costs of printing paper checks instead of electronic payments.”