Has the Occupy Wall Street movement gone corporate? In a move that would undoubtedly send Billy Walsh into an anti-“suit” diatribe, a faction of the activist group that in 2011 took over New York City’s Zuccotti Park in protest of corporate America has endorsed a new prepaid card bearing the Occupy name.
The Occupy Card – which is not yet actually available – is the brainchild of The Occupy Money Cooperative, a group led by a mix of academics, executives, and former bankers that touts itself as being “like a bank…but better.” More specifically, the Cooperative will offer financial products and its customers’ money will be insured by the FDIC, but they’ll “get a better deal…because the Cooperative will be run by its members” and therefore “won’t have to answer to Wall Street,” according to the group’s website.
While it makes sense for the Occupy movement to associate itself with an alternative banking product, seeing as the group’s anti-big-bank protests led to increased business for member-run credit unions, the card will also tie the group to some of the major financial services corporations it was founded to oppose – like Visa, which will serve as the product’s card network. But before we get into The Occupy Card’s potential hypocrisy, let’s determine whether or not it actually provides a better deal for the consumer.
Using our standard prepaid card evaluation criteria, WalletHub came to the following conclusions about The Occupy Card’s cost, overall advantages and disadvantages, and place in the prepaid card hierarchy that has emerged within the past year.
Cost
- Checking Account Alternative: A consumer who replaces their traditional checking account with the Occupy Prepaid Card would have to pay roughly $21.12 per month in order to directly deposit their paycheck (free), withdraw money from an ATM once a week ($1.95/withdrawal OMC fee + $2.33/withdrawal ATM owner surcharge), make five debit card purchases each week (free), and pay two bills by check each month ($2.00/check OMC fee). It’s also important to keep in mind that this card would not be suitable for anyone who needs to pay a monthly bill of more than $800 by check, as OMC’s bill pay service will only process checks up to that amount.
By contrast, the Green Dot Gold Prepaid Visa Card, the Bluebird from Walmart & American Express and the American Express Serve® Card (American Express is a WalletHub partner) can all be free to use as an alternative checking account.
- Financial Literacy Teaching Tool: Someone who wishes to give their child a $100 monthly allowance via prepaid card would be able to load funds to The Occupy Card for free via check. The child would then have to pay roughly $8.56 to make two monthly ATM withdrawals (1.95/withdrawal OMC fee + $2.33/withdrawal ATM owner surcharge) and two weekly debit card purchases with the card.
By contrast, the KAIKU Visa Prepaid Card would cost $1.95 per month all told, while The Approved Card from Suze Orman, the Walmart MoneyCard, and the Bluebird Card from Walmart & American Express would all cost $3-4 per month.
- Check Cashing Alternative: While there the OMC website offers little specifics about how the process works, The Occupy Card’s fee structure indicates that users will be able to deposit checks instantly via mobile phone or within seven days through traditional means for free. As such, it would cost you around $17.12 per month to load one paycheck and make one ATM withdrawal (1.95/withdrawal OMC fee + $2.33/withdrawal ATM owner surcharge) as well as three debit card purchases (free) each week with this card.
By contrast, the Chase Liquid Card and the PNC Smart Access Prepaid Card would cost $4.95 and $5.00, respectively, when used in this fashion.
- Access to Electronic Transactions: Someone who gets paid in bi-monthly $1,000 installments, loads $250 to The Occupy Card twice per month ($3.74 - $4.95 per cash reload, depending on the specific method used) in order to pay two monthly bills ($2.00/check), and makes two debit card purchases each week (free) would wind up spending roughly $11.48 - $13.90 per month on fees.
By contrast, both the Bluebird Card from Walmart & American Express and the Chase Liquid Card would be free to use in this manner.
Pros
- No Monthly or Annual Fees: The lack of fixed costs naturally brings down the overall price of using The Occupy Card.
- Ability to Load Funds via Check: Not all cards are positioned to serve as viable alternatives to expensive check cashing stores.
- FDIC Insurance: Similarly, not all prepaid cards offer FDIC Insurance for loaded funds.
Cons
- High ATM Fee: Given that on-the-go cash access is one of the main reasons that people carry prepaid cards and traditional debit cards, The Occupy Card will never be able to truly compete with the current $1.95 price tag, plus applicable ATM owner surcharges, for each withdrawal. That’s especially true given that many banks and prepaid card issuers are now waiving fees for either some or all ATM withdrawals.
- Online Bill Pay Fee: No one wants to pay to pay a bill, but if you want to replace a traditional bank account with The Occupy Card, that’s what you’d have to do.
- Cash Loading Fee: With bank branches or “in-network” ATMs it’s simply inefficient for consumers to load cash to their Occupy Prepaid Cards.
- Lack of Available Information: While the OMC website lists some basic information about The Occupy Card, including a fee schedule, there is no complete terms and conditions page, nor are there clarifications for certain account offerings, such as mobile phone check deposit.
Marketing Fluff
- “People who are unbanked, underbanked, and even just angry-banked will all benefit from using the Card because it is a better and more affordable product.”
- False: There are better alternatives for every major type of prepaid card use.
- The Occupy Card has a host of mobile apps and other services including mobile deposit capture of checks.
- TBD: "These features are alluded to on OMC’s website, but there is no more proof of their existence than that."
- "We won't have to answer to Wall Street or to profit-hungry directors."
- False: It’s simply hard to make the case that a financial services company that has deals with Visa and offers its card “through a bank” is somehow immune to contemporary corporate culture.
Overall
“At the end of the day, The Occupy Card is a curious entry to the booming prepaid card space that will undoubtedly garner more attention than its terms deserve due it its affiliation – whether direct or perceived – with the counter-culture Occupy Wall Street movement,” said Odysseas Papadimitriou, CEO of the personal finance websites WalletHub and WalletHub and a noted card industry expert. “We can expect this product to struggle not only because of an inability to compete with other recent high-profile additions to the prepaid card market, both in terms of price and functionality, but also because the ‘Occupy’ moniker will likely turn off many mainstream consumers, while the card’s ties to large financial services companies alienate the social movement’s base.”
WalletHub experts are widely quoted. Contact our media team to schedule an interview.