The Kardashian sisters may be shaking up the celebrity-endorsed prepaid card business. After the quick failure of their prepaid card in November, other cards are changing their fees, including hip-hop and fashion star Russell Simmons' card line.
The Kardashian Kard was condemned for what many perceived as a high fee schedule, though its fees were in line with what many prepaid providers charge. Nevertheless, during its three-week life, it drew fresh attention to prepaid pricing, and observers say that other prepaid providers are trying to avoid a similar fate.
On Jan. 5, UniRush LLC announced new fees. UniRush representatives did not return calls seeking an explanation for the changes, but observers said this move was probably defensive.
UniRush's new fee structure "is probably a way of setting up a defense mechanism to say their cards are not like the Kardashian Kard" and lack such high fees, said Ben Jackson, a senior analyst in the prepaid advisory service at Mercator Advisory Group.
Jerry Welch, the chairman and chief executive of prepaid card provider nFinanSe Inc., said the major industry players have "self-regulated" themselves concerning fees and disclosures. "Consumers are now better educated with pricing," he said, "and recognize a fair deal when they see one."
Under its previous fee structure, UniRush's cards came with a $19.95 purchase price for a pay-as-you-go plan that charged $1 per transaction (capped at $10 per month) and a $1.95 automated teller machine withdrawal fee. UniRush's Diamond card had a $3 purchase price and a flat $3.95 monthly fee; cardholders could use it for free signature-based purchases and two free ATM withdrawals per month.
Under the new fee structure, holders of UniRush cards are to pay fees ranging from $3.95 to $14.95 monthly, depending on which plan they choose. The policy language on RushCard's website indicates that UniRush has dropped earlier restrictions. The monthly plan only was available with the Diamond card. All other fees in the pay-as-you-go and monthly flat-fee plans are unchanged.
