July 03, 2013

Paid via Card, Workers Feel Sting of Fees - NYTimes.com

Paid via Card, Workers Feel Sting of Fees - NYTimes.com'via Blog this'

Did you know? "A growing number of American workers are confronting a frustrating predicament on payday: to get their wages, they must first pay a fee."

For these largely hourly workers, paper paychecks and even direct deposit have been replaced by prepaid cards issued by their employers. Employees can use these cards, which work like debit cards, at an A.T.M. to withdraw their pay.
But in the overwhelming majority of cases, using the card involves a fee. And those fees can quickly add up: one provider, for example, charges $1.75 to make a withdrawal from most A.T.M.’s, $2.95 for a paper statement and $6 to replace a card. Some users even have to pay $7 inactivity fees for not using their cards.
Taco Bell, Walgreen and Wal-Mart are among the dozens of well-known companies that offer prepaid cards to their workers; the cards are particularly popular with retailers and restaurants. The banks promoting this nonsense are: JPMorgan Chase, Bank of America, Wells Fargo and Citigroup; The largest issuer of payroll cards is NetSpend, based in Austin, Tex.