Harper Government’s Prepaid Card Regulations Take Effect May 1
New prepaid card regulations will protect consumers and save Canadians money
Finance Minister Joe Oliver today welcomed the coming into force of the Government’s Prepaid Payment Products Regulations on May 1. Prepaid cards, which are available through financial institutions and at retail commercial outlets, are used to make purchases or withdraw funds via a payment network such as American Express, MasterCard or Visa. Part of Canada’s Economic Action Plan, these regulations support our Government’s commitment to protect consumers and save money for Canadian families.
The new rules will ban maintenance fees for at least one year after the card is activated and will ensure that funds for a prepaid card never expire. Federally regulated financial institutions must also disclose fees in an information box that appears prominently on the card’s packaging.
The regulations also require that key information for consumers be included prior to issuing these cards in a manner that is clear, simple and not misleading.
The new regulations apply to all federally regulated financial institutions, such as banks.
The Financial Consumer Agency of Canada (FCAC) is responsible for overseeing and enforcing compliance with these regulations. FCAC has worked with federally regulated financial institutions that offer prepaid cards to ensure that the new requirements are fully implemented.
Financial institutions have all indicated that the regulations will apply to all prepaid cards in the market on May 1, 2014, regardless of when the card was purchased.
“As part of Canada’s Economic Action Plan, our Government committed to protecting consumers and saving Canadians money. These new regulations show we are taking action to support that commitment, helping to create jobs, growth and prosperity across Canada.”
Joe Oliver, Minister of Finance
“FCAC welcomes the new prepaid product regulations, as they are an important part of Canada’s financial consumer protection framework. As the federal agency responsible for overseeing these regulations, we have updated our consumer information on prepaid cards and will continue to work with financial institutions to ensure that the requirements set out in the regulations are effectively implemented.”
Lucie Tedesco, Commissioner of the Financial Consumer Agency of Canada
FAQs on Prepaid Cards
Media Contacts Melissa Lantsman
Director of Communications
Office of the Minister of Finance
April 30, 2014 – Ottawa, Ontario – Department of Finance