News

RI unemployment debit card fees hit a nerve

February 21, 2012

Citizens of Rhode Island are beginning to ask questions about fees charged for use of unemployment debit cards, a news story by the Worcester Telegram reported. The fees are collected by JPMorgan Chase, the provider selected by the state in 2007 to operate its debit card system. 

Like most other states, Rhode Island contracts with a bank to provide unemployment benefits through a debit card. JPMorgan Chase agreed not to charge the state for its program as long as it could earn revenue from card use. The bank charges a $1.50 fee if a user withdraws cash more than once per benefit deposit, plus a fee of up to $3 for using a non-network ATM to withdraw funds. Chase also collects a 50-cent fee every time the user checks their balance, a $1 fee for denied transactions and a 25-cent fee for debit purchases that require a PIN.

"Anything you do you pay a fee; it's how Morgan is making their money on it," said state senator William Walaska, who is pushing for more information on the fees. "These people can't afford these fees, obviously, because they're unemployed. But the state pretty much says, 'We don't want this to cost us any money, so banks, you figure out how to make money.'"

The state senate voted last week to request Gov. Lincoln Chafee to seek a review of JPMorgan Chase's fees. Walaska said the state needs to know how much its unemployment beneficiaries are paying to support the system designed to help them.

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