American Express became the latest company to introduce a prepaid card offering when it announced Oct. 8 that starting in November, customers will be able to load cash onto its Serve prepaid card, without charge, at about 14,000 CVS and 7-Eleven stores.
The cards have grown in popularity in recent years and are now offered by major banks as well as alternative financing companies. Many accept direct deposit of paychecks and benefits checks, and more are beginning to feature mobile apps that allow users to deposit paper checks by simply snapping a photo of them using a smartphone.
Despite their popularity, consumer advocates believe more federal regulation is warranted on prepaids -- including enhanced disclosure of fees. The Consumer Financial Protection Bureau is seeking public comment on possible new rules for the cards.