And by "high cost," we're talking paying $99.95 just to obtain the card and use it for a year.
CNNMoney.com reported Monday that the fees wouldn't stop there. After the initial 12-month period, the "Kard" would charge consumers $7.95 a month to simply use the card, plus $1 every time they added money to it, a $2 transaction fee for every bill they pay with it, and $1.50 for the privilege to speak with a live operator if there's a problem with it. (For example, "This card is eating all my money.")
It's no wonder Connecticut Attorney General Richard Blumenthal issued a warning to parents on November 26 about the perils of the "Kardashian Kard" and other credit cards marketed to young adults.
In a letter to University National Bank, which issues the Kardashian Kard in an agreement with MasterCard, Blumenthal demanded specific details about the card terms, fees and how it's promoted and sold in Connecticut.
Blumenthal called the Kardashian Kard, and others like it, "feckless financial tools designed to promptly diminish in value with virtually every transaction -- and even when consumers don't use the card at all."
Best known for their reality show on E!, "Keeping Up with the Kardashians," sisters Kourtney, Kim, and Klohe live in a Los Angeles mansion and shop daily for designer clothes -- a fantasy for many teenage girls. Which might be why officials are so concerned about the fee-addled prepaid debit card endorsed by the reality stars.
"This card -- or kard -- appears to specifically target young adults in evoking the name and image of the Kardashian family who showcase lives of luxury and extravagance," said Blumenthal. "The [Kardashian] family is marketing a dangerous financial fantasy.
While teens and young adults are particularly vulnerable to getting taken advantage of by high-fee prepaid debit cards, all consumers are potential victims. Especially those ineligible for regular credit cards.
Gail Hillebrand, Director of Consumers Union's Defend Your Dollars campaign, applauded the Kardashians for bowing out of the prepaid debit card business, but warned, "other prepaid card rip-offs are rampant in the marketplace and consumers remain vulnerable to high fees and weak protections."
As consumer frustration with big banks (Chase, Bank of America) grows, so does the number of prepaid debit card options offered by smaller banks. But many consumers may not be aware of all the hidden fees associated with these cards and find themselves getting taken advantage of.
"The newly authorized Consumer Financial Protection Bureau should make reining in abusive prepaid card practices a top priority," said Pam Banks, policy counsel for Consumers Union.
