Russell Simmons' Debit Cards: Capitalism Or Exploitation?
The last great consumer market, ladies and gentlemen, is the poor. And hip-hop mogul Russell Simmons knows this. He's launching a new pre-paid debit card with Visa called the RushCard. But for what reasons?
The development sparks fireworks of questions about whether Simmons' venture, which carries activation and monthly fees to access your own money, is good for America's unbanked population of 10 million people, according to the FDIC. And they're good questions.
Uju Okasi of the Atlanta Post does a really fair job of exploring these questions about whether the card is good for blacks, which seems to be where it's being marketed. But really, the center of this whole thing is the question whether Simmons, whose product is priced higher than its competition, is really doing this to help his community.
"I don't know," says Jason Llorenz, a Brooklyn native and attorney who was part of the team that helped billionaire Bob Johnson transition to financial services, specifically supporting communications around the Black Entertainment Television founder's establishment of a hedge fund of funds, private equity fund and purchase of a commercial bank.
"Russell's brand is as both a money maker and community activist," Llorenz says. "I wouldn't discount the motivation of the card to make him money nor his motivation for the card to help the community."
Making money isn't hard for Simmons, who has been quoted as minimizing the art of making money by calling it "pedestrian." So Rocks Off doesn't question Russell's intentions, per se.
For him, making money is easy, but more telling is the fact there are much, much easier ways to make money than trying to convince people who prefer cash to plastic to deposit their money in an intangible safe they can't see or touch.