Yesterday, the FDIC issued a press release announcing they are embarking on a pilot program to evaluate the feasibility of insured depository institutions offering safe, low-cost transactional and savings accounts. The FDIC wants banks to participate in the program to offer electronic deposit accounts with certain product features. We applied the FDIC’s wish list to a number of existing prepaid debit card products on the market to see how they stack up. Here’s what we found.
The FDIC published a “template”, or wishlist of features that they would like banks to provide to low income or underbanked individuals. The template is available here. The template is described as follows:
The FDIC Model Safe Accounts Template provides insured institutions with guidelines for offering cost-effective transactional and savings accounts that are safe and affordable for consumers. The accounts reflect the following guiding principles: transparent rates and fees that are reasonable and proportional to costs, access to banking services that feature FDIC insurance, and the protections afforded by applicable federal and state consumer protection laws, regulations and guidelines.
We thought it would be interesting to compare the feature list from the template with a couple of existing prepaid debit card accounts. While several prepaid cards met or exceeded many of the FDIC features, the MangoMoney MasterCard from MPower Labs fit the requirements nicely.
The FDIC template included a number of “auxiliary services and fees” that we did not compare (in the interest of time), however, the MangoMoney Card seems to be a great example of a product that fits the primary requirements the FDIC has for cost effective transactional and savings accounts.
Below is a table comparing the FDIC wishlist features (on the left) with the MangoMoney card features (on the right). (note: as always, make sure to read a card’s fees and terms and conditions – the features and fees listed below are subject to change!)
Prepaid debit cards, including the MangoMoney MasterCard, are not perfect. They have fees, and they have limitations. However, for many uses, the cards can be a great (if not perfect) choice.