June 22, 2020

consumer news

FEDERAL DEPOSIT INSURANCE CORPORATION

Whether it’s ordering take out from an 

app-based food delivery service or using 

a ride share app to get home, cash may not 

be an option for payment. More retailers 

are now accepting cashless payments to 

reduce exposure to high touch surfaces. 

When you are used to paying with cash, 

this can be challenging. 

Here are some of the options available to 

you other than cash or traditional credit 

and debit cards.

Prepaid Cards

A prepaid card allows you to use a card 

to make purchases at stores or to pay bills 

online without accessing a bank account or 

using a credit card. These cards usually are 

not linked to a checking or savings account, 

and require you to load money onto the 

card up front. Find more information about 

FDIC deposit insurance and prepaid cards at 

https://www.fdic.gov/consumers/consumer/

news/september2019.html. 

No Cash Payments? Now What?

Here are some prepaid card types: 

• Reloadable prepaid cards allow you to

add money later onto the card after your

initial purchase. Some cards start out as

non-reloadable, but can be reloaded once

you complete the issuer’s registration

process. There are also prepaid cards,

which are “non-reloadable,” meaning you

can’t add more money onto them in the

future.

• A payroll card is a prepaid card you get

from your employer on which you can

receive your paycheck or salary.

• A government benefit card is a prepaid

card used by some government agencies

to provide certain government benefits, 

like unemployment insurance.

• College ID cards are sometimes prepaid

cards also. Some colleges offer a card

that you can only use to pay for things on

the school’s campus and possibly some

nearby stores. Other schools offer a card 

that you can use at any retail location that

accepts that network brand.

• Gift cards may have a network logo that

allows you to use the card widely, or

it may only be usable at certain retailers.

While gift cards have some protections

under federal law, they may not have

certain protections under the Consumer

Financial Protection Bureau’s (CFPB)

prepaid card rules.

Visit the Consumer Financial Protection 

Bureau for more on Prepaid Cards. 

If you already have a bank account, here are 

some cashless payment options and features. 

PHOTO: GETTY IMAGES

In a digital 

economy, what 

are my options?
For more help or information, go to www.fdic.gov or 

call the FDIC toll-free at 1-877-ASK-FDIC (1-877-275-3342). 

Please send your story ideas or comments to Consumer Affairs 

at consumeraffairsmailbox@fdic.gov

Ask your bank if these features are available 

with your account type. 

Mobile Banking Technology

Banking technology and services 

provide the convenience of conducting 

banking transactions with your computer, 

smartphone, or mobile computer device. 

If you aren’t using these services, ask your 

bank if the following are available to you 

and how you can activate them.

Money transfer services: Person-toperson payment services and mobile 

payment apps have become part of 

everyday life for many people. Payment 

services and apps let you send money to 

people without having to write a check, 

swipe a card, or give them cash.

Online bill pay or ebill services: These 

programs generally allow you to sign up 

on your bank’s website to pay your bills 

electronically. You may also be able to 

receive bills electronically.

Contactless payments: Often referred 

to as tap-and-go by banks and retailers, 

contactless payments are a secure method 

for consumers to purchase products or 

services using a debit, credit, or smartcard 

(chip card) by using radio frequency 

identification (RFID) technology or nearfield communication (NFC). To make a 

contactless payment at a store, tap your card 

near a point-of-sale terminal that is equipped 

with the contactless payment technology. 

You can find additional tips on mobile 

banking technology by visiting: Banking 

at the Speed of Technology.

Safety Tips for a Digital Economy

Pay attention to your purchases. Be sure 

to monitor your credit card bills and bank 

statements, as well as app and other online 

transactions for unauthorized purchases or 

withdrawals. Immediately contact your 

bank if you see anything suspicious. 

Consider signing up for alert services.

Many credit card issuers, banks, and mobile 

app providers offer services that notify you 

about certain account activities, such as 

recent logins from unrecognized devices. 

Most banks that offer mobile banking, 

also allow you to sign up for alerts on 

your mobile device or email to notify you 

if your account balance drops below a set 

dollar amount. This can help you avoid 

overdrawing your account. You might also 

be able to request text alerts, if your bank 

observes suspicious or potentially fraudulent 

transactions involving your account. Some 

banks even let you set spending limit alerts 

to help keep track of your spending. 

Protect yourself from scams. Scammers 

often create fake websites or apps that are 

so similar to those of popular retailers; 

it easily tricks consumers into providing 

payment information. The scammers take 

your information and your money, but you 

never receive the products. Be sure to deal 

with reputable companies you are familiar 

with to help avoid encounters with these 

types of scams. 

If you do not have a bank account, FDIC’s 

BankFind tool allows you to locate FDICinsured banking institutions in your area. 

In addition to websites for individual 

banks, a few organizations have compiled 

lists of banks offering accounts that can be 

opened online: 

• BankOn

• American Bankers Association

• Independent Community Bankers

of America

Additional Resources: 

Helpful tips for using mobile payment 

services and avoiding risky mistakes 

(CFPB) 

https://www.consumerfinance.gov/about-us/

blog/helpful-tips-using-mobile-paymentservices-and-avoiding-risky-mistakes/