CFPB Prepaid Regulations

US federal proposals released tighten regulation of the prepaid card market may spur a consolidation of small, high-fee prepaid issuers who may be less transparent or uncompetitive, while boosting low-cost, more transparent providers, according to Fitch Ratings. The new consumer-friendly rules should further bolster growth in prepaid card usage by enabling consumers to more easily make informed decisions on card fees and features. Among the many prepaid issuers in the US, fee structures can vary widely and standardized disclosures may push consumers toward lower cost, greater feature providers. We do not believe the new rules pose a serious threat to major card issuing banks, given underlying prepaid customer demographics and actions taken by banks to offer their own prepaid cards. Prepaid card account consumers are gaining new protections that move the cards nearer to having the same disclosure and reporting protections that credit card users enjoy. The total fees paid for prepaid credit products would not be allowed to exceed 25% of the credit limit. In an effort led by the Consumer Finance Protection Bureau, the protections would be promulgated under US Electronic Fund Transfer Act and The Truth in Lending Act of 2009.

Acculynk + PayPlum

Acculynk is acquiring the intellectual property (IP) of PayPlum, LLC, the first enterprise-class distributed PCI Compliance software solution focused exclusively on reducing the risk, costs and burden of safeguarding the acceptance and transport of sensitive payment card data within the online and mobile channels. Acculynk and PayPlum will form a strategic partnership whereby PayPlum will be a reseller of the enhanced solution to new and existing customers. The deal is expected to close shortly.Acculynk is acquiring PayPlum’s entire IP portfolio that includes a unique, patent pending messaging protocol technology to safely and securely accept and transport sensitive cardholder data and leverage tokenization and PCI scope reduction strategies.