WASHINGTON — The explosive growth of prepaid cards as an alternative to checking accounts has sparked a debate over whether they should be required to have federal deposit insurance.

Federal Deposit Insurance Corp. protection is a gray area in prepaid cards. While the vast majority of cards have indirect FDIC coverage, some — including the recently-announced Bluebird card by Walmart — instead backstop customers themselves.

Limited Time Offer

Save $400 off your subscription. Special offer ends April 30, 2017.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.