Executives with card processors and CUSOs that issue pre-paid gift cards are mustering opposition to a Senate measure which, they say, would close down much of the pre-paid gift card issuing in the U.S.
Authored by Senator Charles Schumer (D-N.Y.) and cosponsored by Senator Mark Udall (D-CO.), the Fair Gift Card Act of 2009 would essentially eliminate almost all fees on all pre-paid cards, including those it calls "general use pre-paid cards" that are marked with a Visa or MasterCard brand.
As written, and passed by the Senate Banking, Housing and Urban Affairs Committee, the measure would cover not only gift cards, but also many other pre-paid and reloadable cards such as payroll cards and health, retirement and other benefit cards.
"Our view is that this measure is simply overly broad and needs to be reconsidered," explained Jeff Russell, senior vice president for strategic development for The Members Group, a leading pre-paid card issuer for credit unions. "We are trying to work with the Senate to help educate them about pre-paid cards."
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