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by Karen Webster

I just love it.  Another story proclaiming cash is going to die a painful death.  This time, its funeral will be held in 2020 in the US.  The obiturary writer is a Pew Reserach report that says 67% of "technology experts" surveyed agree that mobile devices will be so trusted, that consumers will use them exclusively and therefore, never ever need to use cash again.

For more, click here.

SOUTH PORTLAND, Maine, Sep 15, 2011 (BUSINESS WIRE) --

Wright Express Corporation (NYSE: WXS) announced today that it made this year's InformationWeek 500, an annual listing of the nation's most innovative users of business technology, for the first time. The 2011 list was revealed at a recent gala awards ceremony at the exclusive InformationWeek 500 Conference at St. Regis Monarch Beach Resort in Dana Point, Calif.

"Innovation is absolutely critical to our current and future business plans, and it's an honor for Wright Express to be recognized among the country's leading technology organizations," said George Hogan, Senior Vice President and Chief Information Officer of Wright Express. "We continue to be committed to providing the most innovative payment and information technology solutions to our customers and partners to enable them to grow their businesses by saving money, streamlining operations and achieving scale."

To read complete article, click here.

By now, you probably all know that “what’s next in payments” is our favorite topic here at the site. So, we couldn’t pass up a chance to sit down with Jennifer Tescher, President of the Center for Financial Services Innovation (CFSI).

In this exclusive NEXTcast interview, she predicts whether Durbin will deter innovation in payments and discusses her recent article, "Durbin's Unintended Consequence for the Underbanked".

For the complete article, click here.

Reduce payroll cost, increase processing efficiency and build employee loyalty all at the same time.  That's how to make payday better.  The Visa® Payroll card is a reload able prepaid card that provides your company and employees with a convenient, low-cost alternative to payroll checks.

Please click on the link for more information.

visa Re-Invent Payday.pdf (90.45 kb)

From the Orlando Sentinel.

Once a week, Nina Fayad reaches out to some of the hundreds of thousands of Floridians who have little interest in keeping their money in a U.S. financial institution.

To read the full story, click here.

By Brian Slowik, President

rapid! PayCard

Last summer, the former Congress passed the Dodd-Frank Act, a sweeping financial reform bill. Part of that bill sought to change the way debit cards are used by American consumers – supposedly, so that consumers would benefit from competition and lower prices.

If we’re serious about consumer protection, then the new Congress that convenes this year has a vital job: To put the brakes on the newly proposed debit card price fixing regulations and take the considerable time necessary to ensure the law really does protect American consumers.

The Dodd-Frank bill directed the Federal Reserve to set standards limiting the amount retailers pay to accept debit cards and dictating how debit transactions are processed. It is the most far-reaching regulation in the 50-year history of the electronic payments system. And when “reforms” of such scope take place, as a rule the consequences prove to be the opposite of what reformers intended.

Despite any best intentions, the Federal Reserve’s draft regulations prove that rule: They are likely to result in higher prices for consumers, not lower, and at a time when making ends meet remains a challenge for many Americans.

In addition, the rules would have the government fix prices for debit use below the true total costs of running a debit system. (Even Rep. Barney Frank and Sen. Christopher Dodd, the outgoing chairmen of the House Financial Services Committee and Senate Banking Committee, respectively, have acknowledged as much.) The only result of such a plan would be fewer resources available to devote to innovation in vital areas such as fraud prevention (while consumers are demanding more data security and the protection of their financial information).

The Federal Reserve itself even acknowledges that the likely outcome of its rules will be higher fees paid by consumers using debit cards. And the rules provide no guarantee that retailers will pass along to consumers a single penny of the huge savings they will enjoy thanks to government price setting.

The rules appear to be based on a premise that defies logic: If you artificially lower the merchant’s costs, then somehow consumers also can realize significant benefits, with no negative impact on the system. This deeply flawed premise also rests on the false assumption that merchants are altruistic, and will pass their lower costs onto their customers. The fact is, consumers cannot expect anything from these rules but to spend more and get less; price fixing never benefits the consumer over time.

The most troubling aspect of these rules is the incredible speed with which they have been formulated. Given the potential for huge negative effects on consumers, the law left the Fed very little time for a thorough review of the consequences of this extraordinarily complex and potentially very disruptive change in the payments system.

As a result, we believe it would benefit consumers, and everyone who uses the payment system, for the new Congress to promptly delay the effective date of the Federal Reserve’s rulemaking for two years, hold hearings on and direct joint federal agencies to study the debit provisions’ impact, and take appropriate additional action as suggested by the study results. These actions would ensure that consumers, and our economy, do not suffer harm from a hastily enacted and outrageous law.

According to the 2009 FDIC National Survey of Unbanked and Underbanked Households, the majority of underbanked households that go to nonbanks for transactional services such as money orders and check cashing services do so primarily for convenience, speed and cost.

For more information: http://www.economicinclusion.gov/

It’s tax season again.  But this year, instead of waiting for your tax refund by mail, you can get it sooner.  Simple load your refund to your rapid! PayCard® Visa® Payroll Card.  You’ll just need to supply your routing number and account number to your tax preparer, or fill them in on the refund section of your tax return.

To get your routing number and your account number, call our cardholder services line at 1.888.727.4314.

By having your tax refund loaded to your rapid! PayCard® Visa® Payroll Card, you’ll get:

• Quicker access to your money.  No waiting for a refund check by mail, or in long lines to cash it.  You can use your refund as soon as it’s available on your card.
• Increased savings.  There are no check-cashing fees.  It’s free to deposit your refund to your card.
• Greater convenience.  Use your refund anywhere Visa debit is accepted.

File your federal tax return by April 15, 2011, and enjoy a speedy tax refund.

By Amy E. Buttell

Published November 18, 2010 | CreditCards.com

If you're receiving federal government benefits, a debit card may be in your future. That's because the Treasury Department is finalizing a law requiring that all federal payments - except for tax refunds - be made electronically, starting in March 2011.  That means that instead of getting a paper check for your Social Security benefits, for example, you'll be required to get them either via direct deposit or on a debit card.

The federal government has already given recipients the option to make the switch for some types of payments, most of which are recurring payments. But as of now, there's still no law mandating that a federal benefits recipient take the funds electronically. That's likely to change, however, in the next few months.

Consumer advocates are wary, saying that though many transactions are free on these debit cards, the programs are filled with tricks and traps that will cost unwitting consumers. But banks and government officials love the idea, claiming that the cards are cheap, convenient and even safer than regular paper checks.

"Checks are expensive for the government to issue," says Terry Maher, general counsel with the Network Branded Prepaid Card Association, a prepaid card trade association. "There are a lot of problems with checks being returned because of beneficiaries relocating, especially due to natural disasters like Katrina. In a situation where people have to be relocated on short notice, it's hard to get them their benefits checks. There is also a lot of fraud involved with checks."

What's in the proposal?
While the final rule is still to come -- it's expected later this year or in early 2011 -- the proposal would take effect on March 1, 2011. Beginning on that date, individuals would receive their benefits via direct deposit. Those who choose not to use direct deposit, the proposal says, would then be enrolled in the federal government's DirectExpress Debit MasterCard program, unless they meet one of these two conditions:

They already receive federal payments by check as of March 1, 2011.

They filed a claim for federal benefits before March 1, 2011, and specifically requested check payments when they filed.

There is one important exception: tax refunds. IRS payments are excluded from the current proposal, though the Treasury is even considering issuing debit cards for tax refunds, says Dave Turner, senior vice president of government solutions at ACS, which provides debit card services to state and federal government agencies. The IRS already offers direct deposit as an option for tax refunds.

Also, this would apply only to federal payments, though most states are following the federal government's lead in relying more heavily on electronic payments. (See our story on comparing state governments' electronic payment programs.)

How the debit cards work
You don't necessarily have to wait until March 2011 to enroll in the U.S. Direct Express MasterCard program. Many government programs -- including Social Security and Supplementary Security Income -- allow participants to begin receiving benefits today. (Contact your program's administrator to see if it pays benefits via debit card.) Also, if you have an older DirectExpress card, which was issued before April 1, 2008, you may able to lower your fees by getting a new card.

To enroll, visit USDirectExpress.com or call the program's card enrollment center toll-free at (877) 212-9991. Once you get the card, which is issued by Comerica Bank, you activate it via the customer service line and select a PIN. Once you've activated it, you can use it for ATM withdrawals and to make purchases anywhere MasterCard debit cards are accepted.

The website promises the card comes with no sign-up costs and no monthly fees. However, the card is hardly fee-free. For example, you get one free ATM cash withdrawal with each deposit to your account. After that, you'll pay 90 cents per withdrawal. There are also fees for receiving a monthly paper statement through the mail (75 cents a month), transferring funds to another bank account ($1.50 per transfer) and others.

To avoid incurring fees once you activate your card, get cash back at retail stores, where purchases are also free. Get cash back, fee-free, with purchases and withdrawals at MasterCard-affiliated banks, credit unions and savings and loans. You can also check your balance for free at an ATM or over the phone. For extra protection, sign up for online low balance and deposit alerts to keep updated on your account balance to make sure you don't overdraw your account.

You won't necessarily be able to overdraw the account, since the card's terms state that a transaction may be refused for insufficient funds. If you do overdraw your account, the excess amount will likely be deducted from future credits to your account. Or if no money's ever added to the card again, you may be contacted and asked to pay back the extra funds. 

Opinions are mixed
Consumer groups aren't thrilled with the move toward plastic. They say consumers should have the option to receive paper checks and program fees should be lowered. In a letter to the director of the federal government's debit card program, Michelle Jun, staff attorney for Consumers Union, notes that consumers should have the option to still receive checks because many don't live near ATMs or have bank accounts. Also, the fees charged can eat away at a beneficiary's balance, leaving less for food, medications and housing costs, she says.

Another argument against phasing out paper checks, experts say: Many disabled or elderly benefit recipients have never used debit cards and don't understand the rules. For recipients who don't have access to the Internet or to bank branches, the paper statement fee of .75 per month is a major burden as is the limit of one free ATM withdrawal a month.

Consumers who are careful about where they withdraw funds and who keep track of their balances will find many positives, however. For example, debit cards are beneficial for recipients who don't have banks or credit unions in their neighborhoods, says Maher. "You might have to go to a cash checking outlet and pay fees to have your check cashed or pay for money orders to get your bills paid," he continues.

As seen in the Washington Post, the Treasury Department recently announced that most government benefits will be paid by direct deposit by 2013 to help cut costs. Most of these savings will come from the benefits sent out by the Social Security Administration, Department of Veterans Affairs, Railroad Retirement Board and Office of Personnel Management.

This will eliminate around 136 million paper checks and help save money on both paper and postage costs. This will save the government about $48 million dollars in postage costs. Best of all, this policy change will save taxpayers $303 million dollars in the first five years.

By making this switch to new technology, the government is allowing the payments to be delivered in a safe, convenient and secure method. Electronic transfers such as these ensure that payments will be received when people are affected by a natural disaster. These government achieved benefits are those that an employer may achieve by instituting a pay card program. The roll out of a program such as rapid! PayCard will save an employer time and money, improve efficiency, business continuity and disaster recovery and help save the environment as well. Go to rapidpaycard.com to use our cost savings calculator and see how much your company may save!

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