With 22% of the U.S., population being either unbanked or underbanked, providing funds to these Americans can prove difficult. General Purpose Reloadable (GPR) cards which were once all but unregulated, have become fully FDIC insured and offer the same protections as traditional financial institution accounts, due to the prepaid card regulations introduced in April 2019. These cards are fully functional and are able to perform all of the same transactions as a debit card attached to a financial institution. Although these are being issued using a government program, many GPR cards currently available in the market place could have been used to support the IRS payouts.
The CARES Act provided a $1,200 Economic Impact Payment, commonly referred to as a stimulus payment or stimulus check. To date, the IRS has already issued over 140 million of these payments. The majority of these payments were made via direct deposit. But there are still millions of payments to be made.
Today, the U.S. Treasury announced they will be sending 4 million Economic Impact Payments (EIP) via prepaid debit cards, while the remaining payments will be made by check.
The EIP Cards, as the Treasury referred to them, will be mailed with instructions for activation and can be used to make purchases, get cash from in-network ATMs, and transfer funds to their personal bank account without incurring any fees.
The EIP Card, issued by MetaBank, can also be used online, at ATMs, or at any retail location where Visa V is accepted. It has the same consumer protections as traditional debit cards, including protections against fraud, loss, and other errors.
According to the Treasury, “the EIP Card is part of Treasury’s U.S. Debit Card program, which provides prepaid debit card services to federal agencies for the electronic delivery of non-benefit payments.”
Overview provided by C. Sue Brown, Director, Prepaid Advisory Service at Mercator Advisory Group.