Occupy movement prepaid card needs some work

Is this a case of changing the system from the inside or, rather, "If you can't beat 'em, join 'em"?

The Occupy movement, which emerged in 2011 on Wall Street to protest against economic injustice in general and the banking industry in particular, has announced plans to issue the Occupy Card, its own prepaid debit card. The Occupy Money Cooperative, which is sponsoring and designing the card, has already publicized what it expects the general fee structure will be.

Our first look at those proposed fees shows that the Occupy Card needs some work if its sponsors truly want it to be superior to other prepaid cards.

The new card is intended to allow users to "participate in the cashless economy at a significantly lower cost," according to the Occupy Money Cooperative website. "People who are unbanked, underbanked, and even just mad at banks will all benefit from using the Card because it is a better and more affordable product."

Among other features, the Occupy Card is designed to serve as a debit card, savings facility, and "virtual checkbook." Occupy says its card gives holders a safe way to pay for items in stores or on the Internet, and to send the monthly rent check "without getting nickel and dimed or building up debt." The Occupy Card has mobile apps and include mobile deposit capture of checks. And accounts on the card are FDIC insured.

The Occupy Money Cooperative says it will release the card when it's able to raise $900,000 in initial operating capital through donations.

We asked Christina Tetreault, a staff attorney for Consumers Union and an authority on prepaid card, to examine the card's proposed fee structure. Here are her comments:

"What we found is that while fee information is freely available, some of the fees and features don’t appear to make the Occupy Card 'better and more affordable' than some of the prepaid cards out there that we looked at when we rated them earlier this year.

"While the monthly fee is low (99 cents per month) it is not waivable with one direct deposit of a certain amount. Many prepaid cards will waive the monthly fee, but the Occupy Card requires five direct deposits to avoid the fee.

"There are also some annoying fees, such as the 99-cent fee for automated customer service and the $2 fee to talk to a live customer service representative.

"There are other ways the cost to use the card may mount. You can't get money for free at ATMs. While not all prepaid cards have in-network ATMs, many do, and there is usually no charge for getting money at an in-network ATM. With the Occupy Card, even though the collective charges no fee to take money out at an ATM, you’ll still pay an ATM owner surcharge of $1.95 to get money.

"Given that may of these services are available at no charge with other prepaid cards, this one may not be 'more affordable' depending on how it's used."

How would the card be to use? Tetreault continues:

"It’s hard to tell how hard or easy the Occupy Card is to use because it’s not yet available. But based on what’s on the website, it appears to have at least one inconvenient feature. Cash back at the point of sale is free to obtain, but limited to $60 a day. Kind of a hassle.

"There may be good things in store that we just can’t see yet. The website promises many account management tools. These features may end up being tremendously useful to users. And to be fair, the Occupy Card could change a lot between now and when it becomes available to consumers. The card's web page has a donation page and a promise to notify folks when the prepaid card becomes available. As the fee page states: '*This is a working document. We will continue to update this information as we progress.' "

An Occupy Money Cooperative spokesperson told us: "The fees are not set in stone . . . although we do not expect many changes in the prices at launch. That said, we shall always drive for the lowest possible fees, for individual services on the card and overall."