MBSA Schedule I – Prepaid Card Services Terms
PREPAID CARD SERVICES
If approved by Bank in connection with a Program, Bank will provide Prepaid Card Services in accordance with the terms set forth in this Schedule I (Prepaid Card Services) and subject to the terms of this Agreement. Bank will make available to Program Manager, from time to time, its policies, procedures, guidelines and other writings governing the use of the Prepaid Card Services by Program Manager, as may be amended or supplemented by Bank from time to time (the “Prepaid Card Services Guide”). Program Manager shall comply with all of its obligations under this Agreement in compliance with terms and conditions set forth in Schedule I (Prepaid Card Services), the Prepaid Card Services Guide and this Agreement. If there is any conflict between the Prepaid Card Services Guide and this Agreement, the Prepaid Card Services Guide will control. Program Manager shall ensure all terms herein related or applicable to or otherwise referencing Program Manager (or its Subcontractor) that may be applicable to End User are included in the Bank Services Agreement.
General Description of Prepaid Card Services. Subject to the terms, provisions and conditions of this Agreement and this Schedule I (Prepaid Card Services), Bank shall issue Cards and provide Prepaid Card Services to End Users who have Deposited funds into and have access to an FBO Account under a Bank Services Agreement in connection with the approved Program, and Program Manager may market such Cards and Prepaid Card Services to End Users or Persons in accordance with the terms of this Agreement and the applicable Program Schedule provided for in Schedule B (Program Schedules) to this Agreement. Program Manager shall ensure that any Card or Prepaid Card Services offered under any Program shall comply with the terms of this Schedule I (Prepaid Card Services), this Agreement, the Bank Services Agreement, Bank Policies, Compliance Policies and Applicable Laws. Bank and Program Manager further agree and acknowledge that, for purposes of the FinCEN Prepaid Access Rule, Bank is designated as the program participant exercising “principal oversight and control” over the Cards and Prepaid Card Services in connection with the Program.
Issuance of Prepaid Cards.
Bank shall be the issuer of all Cards hereunder. Accordingly, Bank shall sponsor a BIN for the Cards and will issue Cards marketed and promoted by Program Manager pursuant to this Agreement.
Subject to the terms of this Agreement and Applicable Law, including those on bank branching, Bank agrees to issue Cards and provide Prepaid Card Services to End Users who meet the criteria set forth in Account Opening Policy, and who have entered into a Bank Services Agreement governing the Prepaid Card Services and deposited funds into the FBO Account with Bank or have been approved to Deposit funds into the FBO Account with Bank. All Cardholders must reside in any state in the United States, its territories and the District of Columbia, and Program Manager shall not approve any Applicant who does not reside in state in the United States, its territories or the District of Columbia.
Bank will establish an account maintained and controlled by Bank (the “Settlement Account”) to be used for the Settlement of Card transactions initiated in connection with a Card for the related Settlement date. The aggregate amount of Card transactions to be Settled on any given Settlement date shall be referred to as the “Settlement Amount.” Notwithstanding anything to the contrary, Program Manager shall be responsible for any deficiencies in Settlement Amount.
Program Manager acknowledges that Bank is under no obligation to issue a Card or provide Prepaid Card Services to any Applicant or End User. Bank may, in its sole discretion, reject or decline to issue a Card or provide Prepaid Card Services if Bank determines to do so would constitute an unsafe or unsound banking practice, pose a reputational, compliance, operational, regulatory or financial risk to Bank or violate Applicable Law.
Cards. In addition to and subject to the terms and conditions of this Agreement, Program Manager shall, at its sole expense: (i) develop proposed Card designs (and shall ensure such designs do not violate the intellectual property rights of any third party or Applicable Law); and (ii) be responsible for the printing, producing, storing, maintaining, and embossing of Cards and any Card carriers, all in compliance with Applicable Law and the terms of this Agreement. Bank shall review and approve any Card designs (such approval not to be unreasonably withheld or conditioned). Notwithstanding, Card designs may also have to be approved by the applicable Network. Provided Bank approves of the Card design, Bank shall submit, at Program Manager’s expense, such Card design to the applicable Network for approval, which may be withheld by the applicable Network in its discretion. All Card designs shall identify Bank as the issuer of the Card and shall include such other names, trademarks or service marks and disclosures as may be required to conform with Applicable Law, Compliance Policies and Bank Policies.
Account Origination and Servicing
Program Manager will administer the Cards, including related FBO Accounts (and balances associated with such Cards), including posting Card transactions to the corresponding FBO Account and reducing the applicable End User’s balance in such FBO Account accordingly. If a Card transaction is approved and there are insufficient funds in the FBO Account related to the applicable End User, Bank shall have the right to exercise any security interest set forth in this Agreement or the Bank Services Agreement.
Program Manager shall pay all third-party costs associated with Card processing and origination, including, but not limited to, expenses related to Networks and credit bureaus.
In performing its obligations under Schedule I (Prepaid Card Services), Program Manager will act as Bank’s third-party service provider or TPA pursuant to applicable Network Rules. Program Manager will provide the necessary documentation, information and materials to Bank and Bank will apply for Network’s approval of Program Manager to act as Bank’s TPA, all at Program Manager’s expense. Program Manager will not commence any activities relating to the marketing or soliciting of End Users or Persons for Cards or Prepaid Card Services until it has received the Network’s approval to act as a TPA of Bank, and until Bank provides written approval to Program Manager to begin any Card-related marketing or processing activities. Thereafter, Program Manager agrees to maintain its status as TPA of Bank consistent with and to otherwise comply with Network Rules and in a manner that is consistent with the data security standards set forth in Section 23 (“End User Information”) and Section 24 (“Data Security”) of this Agreement. Upon receiving any notice from the Network or Bank that it is not in full compliance Network Rules, Program Manager shall cure any such non-compliance within thirty (30) days (or earlier if required by Applicable Law or a Regulatory Authority).
Card Services, Transaction Processing, Settlement.
Program Manager will be responsible for and liable for all Program Manager Services for the Program and necessary to support Prepaid Card Services.
Program Manager, at its sole expense, shall provide for Processing Services in accordance with Section (g) (“Processing Services”) of the terms of this Schedule I (Prepaid Card Services) and Network Rules and as otherwise necessary to support Prepaid Card Services and Card transaction processing. Program Manager may retain Bank to provide Processing Services, subject to Bank’s approval; in the event Program Manager retains Bank to provide such Processing Services, the Parties shall enter into a separate agreement governing the Processing Services to be provisioned by Bank.
Bank shall be responsible for Settlement with the Networks each Business Day for all Card transactions, including Card purchases, automated teller machine withdrawals and other transactions in accordance with applicable Network requirements. Prior to the close of business each Business Day, Bank will debit or credit the Settlement Account for the Settlement Amount. Prior to any transfer contemplated by the prior sentence, Program Manager shall instruct Bank to cause funds equal to the Settlement Amount to be transferred from the FBO Account(s) to the Settlement Account; provided, any deficiency in funds in the balance of End Users (as reflected FBO Account(s)) whose Card transactions are subject to Settlement shall be the responsibility of Program Manager. For the avoidance of doubt and without limiting the foregoing, Program Manager shall ensure Program Manager has on deposit with Bank an amount no less than the Settlement Amount on each Settlement date and such funds may be used by Bank for Settlement purposes. Bank may, prior to the close of each Business Day, debit or set-off from any Program Account, including the Operating Account or Reserve Account, for any amounts owed to the Networks or any Settlement Amount.
Approved Entities for Loads. End Users may only load funds onto the Card using Bank approved entities for such loads, which include correspondent banks, the Federal Reserve and/or approved Program Manager load networks.
Processing Services.
Program Manager, at its sole expense, shall provide for Processing Services. Program Manager may request Bank to provide Processing Services, and in such case, if Bank agrees in writing to provide Processing Services, it shall provide processing services set forth in Bank’s policies and procedures, as provided to Program Manager from time to time, and all in accordance with Network Rules. In the event Bank provides Processing Services in accordance with the terms herein, Bank may pass through to Program Manager any processing costs assessed on a pass-through basis by a Network and may pass through reasonable, allocable share of any costs incurred by Bank in making changes or modifications to the Processing Service or Bank’s processing systems in order for Program Manager to remain compliant with Network Rules or as otherwise requested by Program Manager. Program Manager hereby assumes l responsibility and liability for all transactions Bank submits to the Network, including any chargebacks, costs (including reasonable attorneys’ fees) and/or Losses associated with, related to or in connection with a Program. On the day that the Network provides Bank with a request for Settlement funding, Bank will make available to Program Manager a summary Settlement report showing all relevant transaction activity.
Any Person (other than Bank) retained by Program Manager to provide Processing Services must be approved in advance by Bank and must have executed a processing services agreement approved by Bank (such Person (other than Bank), the “Processor” and such processing services agreement, the “Processor Agreement”). May act as Processor (and directly provide Processing Services), subject to compliance with the terms set forth herein, Applicable Law, Compliance Policies Bank Policies and any Bank instructions. Whether or not Program Manager retains a third-party Processor or acts as Processor, Program Manager shall be liable for all Losses associated or related to or in connection with Processing Services. Program Manager shall also be responsible for all costs, including reasonable attorneys’ fees, associated with the approval of and integration of Processor and shall ensure that Processing Services comply with Applicable Law and any instructions provided by Bank.
Notwithstanding Bank’s provisioning of Processing Services in accordance with Section (g)(i) herein and unless Bank is providing such services described under this Section (g)(iii), Program Manager shall provide, at its sole expense, the following Processing Services to support Cards and Prepaid Card Services offered in relation to or in connection with a Program:
Transaction authorization, processing, clearing and settlement (unless provided by Bank) and all accounting relating to Cards;
helpdesk and technical support;
data capture and reporting and information management services;
Cardholder dispute processing and resolution in accordance with the procedures set forth in this Agreement or any policies provided by Bank and in accordance with Applicable Law, and any other informal disputes or resolutions as needed from the End User, as promptly as commercially reasonable, and not later than full resolution within sixty (60) days or as otherwise required by Applicable Law;
fraud prevention and security; and
any other services necessary or desirable to effectuate the Prepaid Card Services under each Program or as requested by Bank from time to time.
Program Manager shall provide any data files to Bank at the frequencies and in the form reasonably required by Bank. Program Manager shall provide to Bank processing reports on a daily basis.
Bank may identify additional data files or reports to be generated by Program Manager and delivered to Bank on an ad hoc or periodic basis.
Program Manager shall provide Bank with access to the Dashboard to enable Bank to adequately oversee the Prepaid Card Services in connection with each Program. Program Manager shall provide Bank with access to any sandbox environment and will cooperate with Bank in conducting any pilot test, including test Card profiles, requested by Bank to establish and oversee any Program.
Other Program Manager Services. Program Manager, at its sole expense, shall also provide the following additional services to support each Card or Prepaid Card Service provided in connection with a Program (the “Program Manager Additional Prepaid Card Services”). Program Manager Additional Prepaid Card Services are considered Program Manager Services and shall be approved by Bank. The following are Program Manager Additional Prepaid Card Services to be provided by Program Manager:
processing all Applications, establishing Cards and supporting Prepaid Card Services in connection with each Program on behalf of Bank and subject to Bank’s final approval, including, but not limited to:
providing information to Processor to establish the accounts; and
Card creation, production and shipment, including Card design; purchase and safekeeping of plastic stock; embossing and encoding of Cards; printing of Card carriers; mailing or other delivery of Cards; and preparation and mailing of PIN mailers.
providing monthly and other periodic Card account statements (which may be included as part of the Deposit Account statement);
Customer Service in accordance with the terms of this Agreement; and
any other services necessary or desirable to effectuate the offering of Card or Prepaid Card Services in connection with the Program or as agreed upon by Bank and Program Manager from time to time.
Data Files and Reports. Program Manager shall provide to Bank on a daily basis via secure FTP the data files and reports, in a form reasonably requested by Bank, reasonably required by Bank to oversee the Debit Card Services, as well as the following:
All Cards maintained on the Processor systems regardless of whether the Cards have been issued, activated, funded, closed, etc., or a plastic bearing the Card number has been produced.
Any reports provided by a Network or Critical Subcontractor that Bank can utilize for reconciliation and quality processes; provided, however, Program Manager is responsible for all reconciliation and quality processes.
Taxes. Program Manager shall be solely responsible for the collection and remittance of any sales, use or other taxes applicable to the sale or issuance of Cards under this Agreement. Further, Program Manager will, or will cause it Subcontractors to, accurately and timely calculate, report and pay all sales, use or other taxes applicable to the sale of Cards issued or Prepaid Card Services provided in connection with the Program under this Agreement, and accurately disclose to each Cardholder the amount of such sales, use or other taxes applicable to each Card purchase, if necessary.