Because of an array of other compliance requirements, credit unions and other financial institutions should have at least six more months to comply with new rules on the use of prepaid debit cards for the distribution of federal benefits.

CUNA wrote in a comment letter to the Treasury Department that the rule, for which the compliance date is June 16,  will require considerable technical adjustments. In addition, the uncertainly over interchange fees, even though the cards won't be subject to them, is making this an especially difficult time for credit union compliance.

CUNA opposed the provision that would make a financial institution liable if recipients get federal benefits on prepaid cards in error. It also urged the Treasury Department to provide operational and compliance guidance.

Continue Reading for Free

Register and gain access to:

  • Breaking credit union news and analysis, on-site and via our newsletters and custom alerts.
  • Weekly Shared Accounts podcast featuring exclusive interviews with industry leaders.
  • Educational webcasts, white papers, and ebooks from industry thought leaders.
  • Critical coverage of the commercial real estate and financial advisory markets on our other ALM sites, and

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.