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Released: February 17, 2012
Help Desk FAQ
Prepaid Cards
How am I protected if my prepaid card balance is guaranteed by state money transmitter license?
Some states regulate certain financial service providers through “money transmitter” laws. These laws apply to non-bank businesses that facilitate consumer payments, including prepaid card issuers. Money transmitter laws ensure the soundness of the businesses they cover and require that consumers’ funds be held in trust in case the business fails. To find out if a card issuer is covered by money transmitter laws in your state, contact your state’s department of financial institutions or similar agency. (Do an online search for your state’s name plus “Department of Financial Institutions.”)
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