Chase launches new alternative to checking
NEW YORK — Chase has launched a prepaid card designed to be an alternative to a checking account as it tries to recoup fees it has lost under recent regulatory changes.
The company said Tuesday that the reloadable Chase Liquid card is available at 200 branches and will expand to branches nationwide this summer. Chase said the cards are being tested in two markets but declined to say where.
Banks are looking to prepaid cards and other new products to increase their revenue after regulatory changes have curbed the fees they collect.
Consumers will pay a $4.95 monthly fee for Chase’s card. They can use it to make purchases and withdraw cash from ATMs and Chase branches. The company says it is a low-cost alternative to traditional checking accounts.
Rules that went into effect in 2010 prohibited banks from enrolling customers in overdraft programs without consent. Overdraft fees, which are often $35 or more per violation, were an important revenue stream for banks. Banks also took a hit last summer when new rules limited fees they can collect from merchants when customers pay with a debit card.