Celebrity Card Endorsements Can Be A Tough Act

By Hernandez, Will | American Banker, January 6, 2012 | Go to article overview

Celebrity Card Endorsements Can Be A Tough Act


Hernandez, Will, American Banker


Byline: Will Hernandez

Prepaid debit cards that come with celebrity endorsements over the years have showed little staying power while whipping up storm clouds of controversy.

Reality-show stars Kim and Khloe Kardashian, basketball hall of famer Magic Johnson and hip-hop music mogul Russell Simmons, among others, each had or has a prepaid debit card in the market.

Only Simmons' product remains despite claims he is bilking African American consumers with a fee structure critics view as unfair (see story).

But despite some shaky endorsements, alliances between celebrities and prepaid debit card providers continue.

In November, Rapper Lil Wayne's music recording label Young Money Entertainment launched a cobranded card with Discover Financial Services (see story). And champion boxer Manny Pacquiao is behind a Visa-branded prepaid debit card featuring a remittance service that the product's marketer primarily will promote to Filipinos living in the U.S.

Using celebrities might be an effective way to catch the attention of potential prepaid cardholders and instill trust in financial services, notes Jennifer Tescher, president and chief executive of the Chicago-based Center for Financial Services Innovation.

Tescher warns, however, those celebrities should not go out of their way to violate that trust through high fees or confusing product design.

"I actually think these celebrities should have a higher bar in a way," Tescher tells PaymentsSource. "It's unfortunate to think they are attempting to transfer people's trust in them to trust prepaid and then sort of break the promise and then ruin prepaid's reputation."

Sound familiar?

By now, the industry is well-versed in the Kardashian Kard's disappearing from j-hooks nationwide.

The charge for the card was $59.95 for six months or $99.95 for a year, and the price included the card's $7.95 monthly fee and an initial load fee of $5. Though the card's monthly fee structure was somewhat similar to other offerings, the initial fee caused sticker shock among many watching the industry (see story).

UniRush LLC, founded by Simmons, changed its fee structure shortly after the Kardashian Kard was shelved (see story). Under its previous fee structure, the Visa-branded RushCard and Baby Phat cards came with a $19.95 purchase price that was restricted to a pay-as-you-go plan. That plan also included a $1 fee for each transaction capped at $10 per month and a $1.95 ATM withdrawal fee.

The company's Diamond card had a $3 purchase price and a flat $3.95 monthly fee, and cardholders could conduct free signature-based purchases and two free ATM withdrawals per month. Those options were not available with the other cards

Under the new fee structure, holders of UniRush's cards pay monthly fees ranging from $3.95 to $14.95, depending on which plan they choose for all three cards.

In November, UniRush introduced a $2 monthly rebate to users who maintain an averaged balance of at least $500 across all of a customer's accounts (see story).

Some observers questioned the rebate's value.

"I'm having a hard time thinking about where they could offer that to the masses in a majority of low-income cases," James Van Dyke, the president and founder of Javelin Strategy and Research, told PaymentsSource sister publication American Banker.

Meanwhile, critics continue to skewer Simmons for the RushCard and his support for the Occupy Wall Street movement (see story). …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Celebrity Card Endorsements Can Be A Tough Act
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Author Advanced search

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.