Whatever Happened to Celebrity-Sponsored Prepaid Debit Cards?

Matt Sayles/AP Celebrities don't make the best financiers. Several years ago, a handful famous people jumped into the prepaid debit card business, only to find it wasn't quite the easy route to profits they might have believed it to be. Perhaps they were under that impression because, to coin an old phrase, the financial sector is where the money is. But succeeding in it can be much trickier than it looks. Fed by All Those Fees It's easy to understand why the prepaid card market would be appealing for someone looking for a good side business. In a word: fees. Using a prepaid card generates a raft of payouts for the customer. These can include activation fees, monthly subscription fees, loading fees, ATM withdrawal fees (not to mention ATM balance inquiry fees), customer service fees ... and on and on. How can card issuers tack on so many costs to a simple financial instrument? After all, a typical credit or debit card using the Visa (V) or MasterCard (MA) network carries few if any fees for the user. But prepaid cards are targeted towards a different kind of customer -- lower-income individuals, and those who can have a difficult time securing financial instruments (such as teenagers). Many of these folks lack the income or credit score for a traditional credit card and might not have the means to satisfy the requirements of a traditional bank account. In other words, since they have limited options, as a group these individuals are virtually a captive market for prepaid products. I'd Just Like an Autograph Instead, Thanks