MasterCard sets new standards for payroll cards

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PURCHASE, N.Y. (AP) — MasterCard has set new standards forits payroll cards, and says it says
should help employees take betteradvantage of its benefits.Payroll cards, which are similar todebit
cards, are a means for an employer to pay employees. Theytypically are used as a way to deposit
paychecks for workers who do nothave access to a traditional checking account.The cards havestirred
controversy. Proponents say they are the equivalent of cash orchecks and give people access to funds in
a fashion they can easily use.But critics point to fees to use the cards as a burden on low-wageworkers
who receive them as payment.The Consumer FinancialProtection Bureau issued a warning to employers about
such cards inSeptember based on complaints about fees. And the New York AttorneyGeneral’s office began
looking into about 20 companies for use of suchcards to pay employees to ensure they comply with
consumer-protectionlaws.MasterCard said Friday that its new standards will requireemployers to offer
cardholders greater insight on the cards througheducational resources and increased transparency of any
fees. It saysthe standards ensure the employee has a fee-free way to access their payand check available
balances.Payroll cardholders can accesstheir full pay for free at least once per pay period under the
newstandards and employees will have a choice of how they are paid — bycard, direct deposit or other
means — as required by law."Payrollcards serve as one way to bring the traditionally underserved
into thefinancial mainstream," Ron Hynes, group executive of Global PrepaidSolutions at MasterCard,
said in a statement. "These standards will helpensure that employees not only understand the
choices available, butallow them to take advantage of benefits like direct deposit, onlineshopping and
bill payment that have not been traditionally available tothem."All new MasterCard payroll card
programs will need to meetthese standards as of July 1 and existing programs will have until Oct.1, 2014
to make any necessary adjustments.Copyright 2013 The Associated Press. All rightsreserved. This material
may not be published, broadcast, rewritten orredistributed.

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