by Uju Okasi
Black households compose 21% of the 10 million Americans that are considered “unbanked”– unable or unwilling to open checking, savings or credit card accounts. While some find themselves on a Chex Systems database used to deny services to individuals with previous account delinquencies, others, wary of the complex fee matrix imposed by many financial institutions, choose to opt out of banking on their own.
Hip-hop mogul Russell Simmons reaches out to this population with the Rush Card, a debit card intended to provide African-Americans with a means of financial control and convenience. But the Rush Card has come under fire as critics question the card’s value to the black community. For example, professor of finance at Syracuse University, Dr. Boyce Watkins, is unimpressed with the purported mission. During an interview with radio program, “The Takeaway”, he stated, “It’s a very interesting sort of idea here. [Simmons is] saying ‘I’m giving everyone access to the American Dream,’ but I never really knew the American Dream consisted of having a piece of plastic that puts people further and further in debt.”
It’s worth clarifying a few things about the service. Many assume that the Rush Card is a credit card, but it is in fact a pre-paid debit account. Due to whatever restrictions or mistrust bar working class African-Americans from traditional banking, their options for financial transactions lie in check cashing, in-person payment, and manual cash management. Not only does this slow people down, but, as Simmons’ points out, this may even cost consumers time off work as they attempt to deliver bill payments in person.
The Rush Card extends the conveniences of direct deposit, expense tracking and online payments to individuals in desperate need of alternatives. Since the card is prepaid, it is impossible for the holder to overdraw their account and incur fees. The account also offers an optional feature, RushPath to Credit, which reports successful cable, utility, telephone and other bill payments to credit reporting agencies.
1 comment:
The RushCard is a good idea ruined by a terrible implementation. It is one of the most expansive prepaid cards on the market, in spite of Simmons' spin about its pricing.
Just shop around for other Visa reloadable prepaid cards that are a lot less costly and offer more features.
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