Prepaid Cards at Tax Time and Beyond: Findings and Lessons from the MyAccountCard Pilot

Caroline Ratcliffe, William J. Congdon and Signe‐Mary McKernan

Journal of Consumer Affairs, 2018, vol. 52, issue 2, 286-316

Abstract: The MyAccountCard provides tax filers with a low‐cost prepaid card account for the electronic delivery of their tax refunds. Under the pilot, 808,099 low‐income individuals were randomly assigned to one of eight treatment groups that differ along three dimensions: (1) no monthly fee vs. $4.95 monthly fee, (2) savings account vs. no savings account, and (3) convenience vs. safety messaging. We find that individuals are price sensitive, the savings account (as designed) was not valuable, and that messaging did not influence behavior. The $4.95 fee (vs. no fee) decreased MyAccountCard take‐up by 42% and the likelihood of depositing a tax refund into the card account by 50%. Individuals with the highest propensity to be unbanked were three times more likely to take up the card and nearly 2.5 times more likely to use it to receive a tax refund as those with the lowest propensity to be unbanked.

Date: 2018
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