JPMorgan May Be Selling its Corporate & Public Prepaid Card Business

January 10, 2014         By: David Mindich

According to a statement by JPMorgan, the bank is considering “a full range of options for its [corporate and public] prepaid card business, including a sale.”

While JPMorgan doesn’t mention the reasons for looking to get rid of their prepaid card business, it’s not too hard to speculate.

Just last month, JPMorgan announced that 465,000 of its UCard members’ accounts may have been hacked. People are suing over the use of prepaid cards as payroll cards (though more of an issue for the employer, it’s still certainly not good press for Chase and JPMorgan), and with government regulators inspecting the use of payroll cards to ensure employees’ rights aren’t being violated, it seems like JPMorgan’s prepaid card business might just be more trouble than it’s worth for the bank.

The statement specifies, “Corporate, U.S. Public Sector and Electronic Benefit Transfer (EBT) programs, as well as Health Savings Accounts (HSA)” may be affected. Those who currently use the cards for normal functions like food stamps, unemployment benefits, and tax refunds will still receive full support from the bank while JPMorgan figures out what it wants to do with its prepaid business, but it will no longer be accepting new users for the time being.

According to the same statement from JP Morgan, “Chase customers, including cardholders of Chase debit, credit, Chase Liquid and commercial cards, are not affected by this decision.”