MasterCard have released new standards designed to help employees take full advantage of the benefits of having their paycheck electronically deposited onto payroll cards.
The payroll card standards require employers and payroll card providers to offer cardholders greater insight on how to access their pay through educational resources and increased transparency of any fees. Additionally, the standards ensure the employee has a fee-free way to access their pay and check available balances.
“Payroll cards serve as one way to bring the traditionally underserved into the financial mainstream,” said Ron Hynes, group executive, Global Prepaid Solutions, MasterCard. “These standards will help ensure that employees not only understand the choices available, but allow them to take advantage of benefits like direct deposit, online shopping and bill payment that had not been traditionally available to them.”
MasterCard developed the new standards in consultation with its customers and partners, as well as community organizations through its Master Your Card and Master Your Card: Oportunidad public education programs. In the course of this six-month process, the collective group worked with a wide variety of community organizations– ranging from national Latino, African American and Labor groups to local community groups who represent a high percentage of members who are financially underserved.
“MasterCard has been an important partner in our efforts to create guidelines for financial products that are a force for good in people’s lives,” said Jennifer Tescher, President and CEO of the Center for Financial Services Innovation (CFSI). “We salute the company’s leadership in setting standards to promote a high-quality payroll card market. Quality payroll cards provide security, convenience and inclusion and can help consumers improve their financial health.”
All new MasterCard payroll card programs will need to meet these standards by July 1, 2014. Existing programs will have until October 1, 2014 to make any necessary adjustments.
The MasterCard payroll card standards address:
- Choice – Employees can choose how they are paid – card, direct deposit or other means, as required by law
- Full Pay – Payroll cardholders can access their full pay for free at least once per pay period
- Free Access – Free and easy access to account balance information online or via mobile
- Peace of Mind – Coverage by MasterCard’s Zero Liability guarantee against fraudulent use and the ability to freeze a lost or stolen card and have funds reissued on a new card
- Simple Disclosure – A new, easy-to-read disclosure table will outline the services and fees associated with the card
- Consumer Education – Payroll providers must provide employers and their employees with resources to help them understand the features and benefits of their payroll card, such as MasterCard’s Your Money Smarter program
“As the son of working class parents, I know first-hand that every dollar counts for working families,” said Fabian Nuñez, chair of Oportunidad’s Advisory Board and former speaker of the California Assembly. “We have a collective interest in making sure prepaid payroll cards are implemented in a way that maximizes benefits for workers. I applaud MasterCard for not only listening, but including input from multiple groups in establishing these standards.”