The Network Branded Prepaid Card Association is following the lead of other payments-industry bodies such as NACHA by hosting a planned annual conference dedicated to players in its sector with a focus on government regulations, the organization announced April 7.
The nonprofit association’s conference would be “of the industry, by the industry and for the industry,” Kirsten Trusko, the organization’s president, tells PaymentsSource.
The initial event, called the NBPCA Annual Congress, will take place June 3 to 5 at the Gaylord National Hotel & Convention Center in Maryland. The association will reinvest any revenue it generates from the show to support future advocacy efforts.
The conference’s location serves to accommodate relatively easy access for regulators and politicians in Washington, D.C., who might want to participate in panel discussions and workshops, Trusko says. The association wants the conference to emphasize and highlight the regulatory issues facing the open-loop prepaid card market, she says.
“[This conference] is an open line of communication to engage” government officials, Trusko says. “They’re really interested in being engaged, and we have to make it easier for them.”
Government efforts to regulate prepaid cards prompted the association to develop its own conference, Trusko says. “When the first piece of real legislation hit and it targeted prepaid, we thought. ‘let’s get over this one thing, and it’ll calm down,’” Trusko says. But additional pending regulations followed the initial law.
The Credit Card Accountability, Responsibility and Disclosure Act included rules that limit the fees and expiration dates for certain prepaid products, primarily open and closed-loop gift cards (see
Other parts of the new rules stipulate the cards cannot expire within five years from being issued and that the terms of expiration must be clear and conspicuous.
Besides federal regulations, states also are starting to target prepaid card policies. Some 38 states have bills pending that in some way could affect prepaid cards (see
To launch a conference on regulation “makes sense, considering that is what is having the biggest impact on the industry at the moment,” says Ben Jackson, a senior analyst in the prepaid advisory service at Mercator Advisory Group in Maynard, Mass. “The Dodd-Frank Act with the Durbin amendment, the CARD Act, the potential [Financial Crimes Enforcement Network] regulations, and the creation of the Consumer Financial Protection Board will all play a big role in the future of the prepaid industry.”
And advocacy is the one emphasis the industry believes it needs at the moment, Jackson adds.
Regulators should not view their potential participation at the conference as a conflict in that the association could use revenue from the show to lobby against their legislation, Jackson says.
“Regulators show up to those events knowing that they likely face hostile crowds and an organization that will lobby against future regulations,” he says. “I don’t think regulators are counting where the dollars go, and they are more likely to want to be heard than to skip the event in the thought that somehow they would deprive it of significant revenue.”
But the industry will have to decide whether there is room for another prepaid conference or whether existing conferences already focus enough on regulatory issues, Jackson says. The association also should determine whether it needs “a place to plan a strategy for engaging with the government around regulations,” he adds.
Trusko understands the potential for friction with other organizations that host prepaid conferences. But she emphasizes the goal “in putting this together was to focus on the positives [the conference] puts in the industry.”
