The Consumer Financial Protection Bureau (CFPB) has asked the court to end PayPal, Inc.’s lawsuit against the Bureau. The Prepaid Card Rule is being challenged, which took force in 2019. To go deeper into the topic and know who can help you with merchant account providers, keep on reading the post.
PayPal, Inc.’ s Lawsuit Against CFPB
The Rule has established certain requirements for fee disclosure, restrictions on credit linking, and other measures that can help protect consumers in terms of prepaid accounts. PayPal believes the Rule violates its free-speech rights under the First Amendment.
According to the CFPB, the Rule ensures that consumers’ traditional credit card accounts can go on being fully protected on a federal level. Simultaneously, consumers can link these accounts to digital wallets to keep funds.
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Why CFPB’s Conclusion Is Challenged
The payments giant’s lawsuit challenges the CFPB’s conclusion concerning digital wallets. According to the CFPB, digital wallets and reloadable debit cards operate in the same manner, so they should fall under the same regulations.
Besides, some digital wallets can be used for storing and accessing funds, and PayPal states that this feature, while available, isn’t mandatory, and the majority of PayPal users don’t need this feature.
Moreover, the CFPB is also putting pressure on the Court so that PayPal’s First Amendment claim can be rejected.
So, PayPal Inc. has filed a lawsuit against the CFPB. Soon, it’ll be clear whether the case will end up with uncomfortable results for payments players or not.
Author Bio: Payment industry guru Taylor Cole is a passionate payments expert who understands the complex world of merchant account providers. He also writes non-fiction, on subjects ranging from personal finance to stocks to cryptopay. He enjoys eating pie on his backyard porch, as should all right-thinking people.