WASHINGTON—The CFPB will delay finalization of its proposal on prepaid products, possibly until May or June, according to several reports.
The proposal was originally listed on the CFPB’s rulemaking agenda as coming out by the end of March.
The CFPB’s proposal would extend to prepaid accounts, including general purpose reloadable cards and digital wallets, many consumer protections under Regulation E, which implements the Electronic Fund Transfer Act. It also includes protections under Regulation Z, which implements the Truth in Lending Act, for prepaid accounts that offer credit options.
The waiting game has created tension among prepaid issuers as the industry prepares for the unknown.
“We are in limbo,” said Brad Fauss, president and CEO of the Network Branded Card Association, in a report in paybefore.com, which covers the emerging payments market.
A large concern among prepaid issuers is that the new rules will be another compliance burden.