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Payroll Card Programs Expose Banks to Compliance Risks
By Matt Squire
printAs the demand for stored value cards increases, financial institutions are moving quickly to roll out various money-transfer programs, among them payroll cards. But compliance professionals say banks should proceed with caution and consider the risks of such programs. Growth in payroll cards, reloadable, virtual debit cards used as an alternative to traditional payroll checks, is rising fast. Some 7 million are now in circulation in the United States, up from 2.2 million in 2004, according to independent researcher Pelorus Group. About 17.5 million will be in use by 2010, Pelorus estimates. The cards are popular because they offer cost...
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