Skip to main content
U.S. flag
An official website of the United States government
Dot gov
The .gov means it’s official. 
Federal government websites often end in .gov or .mil. Before sharing sensitive information, make sure you’re on a federal government site.
Https
The site is secure. 
The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.
Deposit Insurance

Prepaid Cards and Deposit Insurance Coverage

En Español

A number of entities market prepaid cards that state they offer FDIC deposit insurance to cardholders. The following information is intended to help consumers better understand FDIC deposit insurance coverage for prepaid cardholders.

When does FDIC deposit insurance apply to my prepaid card?

  • The prepaid card must be registered with the card issuer so that the FDIC can identify the cardholder should the bank fail.
  • FDIC deposit insurance coverage only applies when a bank fails.
  • Your funds are insured by the FDIC if specific deposit insurance requirements* are met.

When would FDIC deposit insurance not apply to your funds?

As stated above, FDIC deposit insurance coverage applies only when a bank fails. Please remember that deposit insurance does not apply in other situations, such as where your card is lost or stolen or your card provider declares bankruptcy. However, in those situations, other legal options may be available to you to pursue recovery of your funds. These options may be discussed in your account agreement.

*Deposit insurance requirements:

In order for the funds on your prepaid card to be insured, certain requirements must be met:

  • the account records at the FDIC-insured bank must disclose that the prepaid card provider is serving as the custodian on behalf of the cardholders;
  • the records of the FDIC-insured bank, custodian or other party must disclose the identities of the actual owners of the funds (you, the cardholder) and the amount owned by you;
  • the deposits must be owned (under the agreements among the parties) by you and the other cardholders of the prepaid cards.

If these three requirements are met, your funds will be insured up to $250,000 (together with any other funds in the same right and capacity that you (the cardholder) may have established in another deposit account in the same bank).


If you have any questions, call the FDIC at 1-877-275-3342 (877-ASK-FDIC).

Last Updated: May 13, 2020