RushCard Glitch Leaves Thousands without Access to Their Money
A popular line of prepaid debit cards from Russell Simmons recently experienced a technical glitch that left thousands without access to the funds in their accounts. The breakdown of the RushCard line, mostly used by unbanked Americans, has caused many people to miss care payments, skip bills, and get denied at the checkout line because their cards would not work.
The glitch started on October 12th after a software upgrade caused thousands of accounts to display a zero balance, despite having money in the accounts.
The company assures customers that their money is safely stored in MetaBank, a financial institution specifically designed for RushCards. That is good news, but it does not matter much if the customers cannot access the money they need.
RushCard CEO and Chairman Rick Savard said in a statement:
“In an ongoing effort to upgrade and create new services for our customers, RushCard underwent a technology transition to a new transaction processing partner Monday morning. During this process, many of our customers were adversely affected when the technology that was used to transition their accounts did not work as planned.
“RushCard is working around the clock to resolve all of these matters. We have restored many of our customers’ accounts, but we acknowledge that there are still customers that need their accounts fixed and their problems resolved.
“We know how important our cards are to people who use them to conduct their daily lives. We apologize for the inconveniences and for the hardships that many of our customers are currently facing.”
There has been a significant increase in prepaid card usage over the last two years, according to a Pew Charitable Trusts study. That survey revealed a 50% boost in prepaid cards between 2012 and 2014. The same study showed nearly half of unbanked Americans earn less than $25,000 a year, and they make up a large portion of RushCard users as well as customers of other prepaid card services.
That’s why a glitch of this magnitude is so significant. It leaves low income, unbanked consumers with no way of paying their bills and living expenses. RushCard will not say exactly how many people have been affected by the issue, but the number is in the “hundreds of thousands.”