Tech vendor fixes problem that held up prepaid cardholders' paychecks

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Several days after U.S. workers who deposit their wages onto Netspend prepaid cards began complaining that they hadn’t received their latest paychecks, transactions are now being processed normally, according to the companies involved.

The customer furor stemmed from problems at FIS, the Jacksonville, Fla.-based financial technology provider, which processes payments for MetaBank, one of several banks that issues Netspend cards.

“The interruption has been remediated, and operations are running as normal this morning,” a spokeswoman for Sioux Falls, S.D.-based MetaBank said in an email Wednesday.

FIS spokesman Jim Kerr confirmed that the problem, which affected the processing of payments over the automated clearing house network, has been fixed.

Earlier this week, scores of Netspend customers who had not yet received their paychecks took to Facebook and Twitter to gripe. Many consumers who deposit their wages onto prepaid cards live paycheck to paycheck, so any delay in receiving their earnings is particularly painful.

Netspend, a division of Total System Services in Columbus, Ga., was apparently one of multiple firms whose customers were affected by the problems. The identities of the other companies, which also partner with MetaBank, have not been disclosed.

A Netspend spokesman said in an email Wednesday that the prepaid card issuer worked diligently with MetaBank and FIS to resolve the situation.

“Cardholders whose direct deposit transactions were previously delayed have now been processed,” he said. “We sincerely apologize for any inconveniences this may have caused our valued customers.”

It is unclear how many consumers were affected by the delays. Netspend is one of the nation’s largest issuers of prepaid cards.

The consumer complaints this week were reminiscent of earlier payment processing fiascos involving prepaid cards.

In the most high-profile example, many RushCard customers were unable to access their funds during a transition to a new payment processing platform in 2015. The company that issued the cards eventually agreed to a $20.5 million settlement to resolve thousands of claims in a class-action lawsuit. Regulators orders RushCard’s parent company and Mastercard to pay $13 million in restitution and fines.

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Prepaid cards Payment processing ACH Payroll payments FIS Netspend TSYS