The assistant secretary of the US Treasury, Michael Barr, gave a talk last week at the annual CFED conference and has echoed these comments in other places as well.  He was talking about the underbanked.  I was happy to see that most of his speech was about access.  Too many consumer advocates want to clamp down on bad practices with no regard for the unintended consequence of limited access: if you make payday illegal, for example, it will limit access, but not the demand.  The unintended consequence is that people with short-term cash needs will go online and pay EVEN MORE to an unregulated, off-shore payday lender (like we’re seeing in Arizona).  So to hear people like Michael Barr stress access is a big deal.

And while he mostly envisions access to “mainstream” financial services (for the good reasons of increasing proximity to savings and credit building, even if impractical for millions of real people), he is actively embracing the value of general purpose reloadable prepaid cards.   This is also a major step forward, since many advocates remain skeptical of the “high fees” associated with GPR (ignoring the fact that checking accounts actually are more expensive in actual use-cases by poor users).

Anyway, I thought you’d like to know…