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Prepaid Cards and Deposit Insurance Coverage

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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?

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:

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).