Final rule regarding payroll accounts is required July 1, 2007. It is my understanding that the new Section 205.18 disclosures are only required if we offer payroll accounts that allow our business customers to make their payroll on the cards rather than issue a check. It is my understanding there are no disclosure / compliance requirements if we do not offer the payroll cards to our customers. Just wanted to make sure. Please cofirm or contradict. Thank you for your response.

Payroll card accounts that are established directly or indirectly through an employer, and to which transfers of the consumer’s salary, wages, or other employee compensation are made on a recurring basis will be covered under this new section. If you are not participating, you won't have to address these issues.

Would a payroll card opened by an employee on their own and having their wages put on it be considered "indirectly through an employer" for the definition in Reg E?

If "A" bought a card and had direct deposit to a bank account, and from that account had money put on the card, no, I don't think that would meet the definition of a payroll card or be indirectly from an employer. So the employer wouldn't be a financial institution. The bank issuing the card would. Admittedly I'm not sure how close this scenario is to what you were thinking. I'm not sure how else the employer would be re-charging the card?

The card account would be where the direct deposit of payroll would go to. My quandary is if the account is opened by the employer, definitely qualifies under "directly". Since the employee comes to us, tired of fees at a currency exchange, and orders up our payroll card product that is loaded by the employer direct deposit, would this be considered "indirectly"?

So there is no deposit account, that is, the card is the deposit account? I guess I haven't seen this process. The funds go to the bank. The bank puts them in this "card account."

I don't believe the employer has any responsibility here if it is transparent to them. But it sounds like you have a Reg E product.