Thursday, July 3, 2014
Celebrities discontinue prepaid cards
Much media fanfare met NBA Hall of Famer Earvin "Magic" Johnson and personal finance guru Suze Orman when they put their names and reputations behind general-purpose reloadable (GPR) prepaid cards. But now comes word that the two cards bearing their imprimaturs were to be discontinued.
A June 20, 2014, Wall Street Journal MarketWatch report said Orman's Approved Card (issued by the Bancorp Bank) and the OneWest Bank FSB-issued Magic card, both launched in 2012, were set to end, with Johnson's card to be shuttered on June 30, 2014. The reason for the discontinuation of the cards seems to be lack of consumer adoption, as consumers increasingly recognize that other GPR cards exist with more friendly fee schedules.
The Approved Card charged a $3 monthly maintenance fee that was on the low end of the prepaid fee scale, but may still have been too high for unbanked and underbanked individuals. Meanwhile, the Magic card charged a $4.95 monthly maintenance fee, as well as fees for balance inquiries and customer services calls.
When the Approved Card was launched in January 2012, Orman said the GPR product was "the single most important thing I've done in my whole career." The Magic card was launched in June 2012, with Johnson equally enthusiastic about his branded card's potential to help financially underserved consumers.
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