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1.2.4 Payments to the Consumer

  • Payroll cards: Payroll cards are a form of prepaid card used by employers instead of paper checks to pay wages to employees without bank accounts. Payroll cards are a form of prepaid card, discussed in Chapter 7, infra, and particularly in §§ 7.3 and 7.3.3, infra.
  • Rebate, incentives, and other prepaid cards used to pay consumers: Non-reloadable, network-branded (that is, Visa or MasterCard) prepaid cards are increasingly being used instead of paper checks to pay merchant rebates, employee incentives, and other payments. These cards are covered in Chapter 7, infra.
  • Government payments: The various methods used to make federal benefit payments to consumers are discussed in Chapter 9, infra. Government payment of needs-based, state administered benefits on an EBT card are discussed in Chapter 8, infra. Payments made through prepaid cards are discussed in Chapter 7, infra.
  • Check payments to consumers: These payments are governed by the UCC (as are check payments from consumers), including consumer rights when a check is lost or stolen or the check is sent to the consumer as full satisfaction of a debt. In addition, federal law regulates when check deposits must be available for the consumer to withdraw. These issues are discussed in Chapter 4, infra.
  • Cashing a check: Check-cashing at either the payor’s bank or at a non-bank check-casher can be expensive or difficult. Consumer rights in this area are set out in §§ 4.7 and 4.11, infra.
  • Electronic transfer of funds into a consumer’s account, including direct deposit of paychecks: These transfers are regulated by the EFTA, as set out in § 5.7, infra. Other rights may be available for errors related to an ATM deposit, as set out in § 5.11.3, infra. Direct deposits can also be made to prepaid cards, discussed in Chapter 7, infra.