Despite 'egregious' fees, prepaid card sales soar

The National Retail Federation says more than four in five people will give gift cards this holiday season, and we’ll spend an average of more than $150 each. Gift cards are definitely great— they’re easy to wrap and ship, and you don’t have to worry about getting the wrong size or color — but they’re not all created equal. Make the wrong choice and you could inadvertently give a gift that’s loaded with sneaky fees, which is about as much of a bummer for the recipient as getting a lump of coal.  The Federal Reserve issued some new rules about gift cards in 2010.

A sample of the new ID card, which uses the MasterCard network.

There are other, less fee-laden prepaid debit cards out there than this.

Thank goodness for celebrities. Without them we might never fully appreciate blatant self-interest, and we definitely would not have so many occasions to discuss the evils of fee-laden prepaid debit cards. The latest star with plans to fleece his adoring public is teen hit-maker Justin Bieber—with a hearty assist from an online finanical firm that goes by the unfortunate name BillMyParents. The card, announced last fall, is set to go live in the next week or so. As part of the endorsement deal, Bieber is expected to appeal to young people to learn more about personal finance.

Thank goodness for celebrities. Without them we might never fully appreciate blatant self-interest, and we definitely would not have so many occasions to discuss the evils of fee-laden prepaid debit cards. The latest star with plans to fleece his adoring public is teen hit-maker Justin Bieber—with a hearty assist from an online finanical firm that goes by the unfortunate name BillMyParents. The card, announced last fall, is set to go live in the next week or so. As part of the endorsement deal, Bieber is expected to appeal to young people to learn more about personal finance.

Prepaid debit cards are the new celebrity fragrance. In the past two years ago, we've seen stars like the Kardashian sisters, Suze Orman, Russel Simmons, and George Lopez all plaster their faces on plastic. 

The entrance of mainstream financial institutions transformed the prepaid debit card market. Customers have more options today, and many of the newer cards closely resemble the checking accounts they are replacing. The big difference is that prepaid cards are more lightly regulated than bank accounts, which is a concern to consumer advocates because the quality and consumer-friendliness of the cards on the market varies widely as a result.

Prepaid debit cards are the new celebrity fragrance.