Members Embrace Teen Card

July 08, 2010
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A debit card geared to teenagers has generated strong interest among youth seeking financial independence—and parents not yet ready to cede all financial controls.

Meriwest Credit Union’s new Flow Account allows teenagers to carry a personal Visa Debit Card rather than cash. Parents and teens manage the account jointly through the San Jose, Calif.-based credit union’s online banking module.

Parents can fund Flow accounts from their personal accounts, monitor transactions, establish regular automatic transfers, and activate online alerts for balance levels or purchases. The account can’t be overdrawn, preventing overdraft charges.

“The Flow Card creates the opportunity for parents to have a new conversation with their kids about money and managing budgets,” says Meriwest CEO Christopher Owen. “Parents can decide how much goes into the flow account and can set spending limits. Teens gain more independence as they can also go online, access their accounts, review their spending, and track the available balance of their cards.”

The $1.3 billion asset credit union introduced the Flow Card in November. Without advertising the card, Meriwest opened nearly 100 accounts during the first month. One-third of users were new accounts.

Meriwest also designed a micro site ( as a resource for teens and their parents.

Meriwest reports that the account:

• Encourages financial accountability with online tracking of purchases;

• Introduces teens to budgeting and setting spending limits; and

• Helps parents teach teens about balances, interest rates, and financial management.

Compliance Q&A

Q Must a credit union provide a change-in-terms notice under Regulation E if it changes the contact information members must use to report possible unauthorized ATM/debit card transactions?

A Yes, if the credit union will impose liability on members for unauthorized electronic fund transfers (EFT). A consumer may be held liable for an unauthorized transfer only if the credit union provides the appropriate initial disclosures detailing the member’s liability under the EFT agreement.

These disclosures include the telephone number and address of the person or office to be notified when the consumer believes an unauthorized EFT has been or may be made.

So, any change to this term of the agreement must be disclosed 21 days before the effective date of the change if the credit union plans to impose liability for unauthorized EFTs (within Reg E’s parameters, of course). 

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