Profile: Green Dot Corp (GDOT.K)
7 Mar 2014
Green Dot Corporation (Green Dot), incorporated on October 26, 1999, is a bank holding company. The Company is the provider of prepaid debit card products and prepaid card reloading services in the United States, as well as engaged in mobile banking with its GoBank mobile bank account offering. Green Dot provides money management solutions to a base of United States consumers. The Company operates under four consumer segments: Never-banked, Previously-banked, Underbanked and Fully-banked. The Company is a provider of general purpose reloadable (GPR), prepaid debit cards in the United States and that its Green Dot Network is a reload network for prepaid cards in the United States. Green Dot Corporation products are available to consumers at more than 80,000 retailers nationwide, online and via application stores. The Company’s bank subsidiary is Green Dot Bank, which is located in Provo, Utah. Its principal products and services consist of Green Dot-branded GPR cards, co-branded GPR cards, and csale (POS), swipe reload transactions facilitated by the Green Dot Network. It also service general purpose gift cards. The Company has designed its products and services to appeal primarily to consumers living in households. In February 2012, its subsidiary bank became a member bank of the Federal Reserve System. During the year ending December 31, 2012, the Company’s operating revenues derived from products and services sold at the store locations of Walmart and its three other retail distributors, represented percentages of its total operating revenues approximately 64% and 20%, respectively.
The Company’s Green Dot-branded GPR cards provide consumers with a way to manage their money and make payments without undergoing a credit check or possessing a pre-existing bank account. In addition to standard prepaid Visa- or MasterCard-branded GPR cards, it also offers GPR cards marketed for a specific use or market, such as its Online Shopping card, its Prepaid Student card and its Prepaid NASCAR card.
To purchase a GPR card in a retail store location, consumers select the GPR card from an in-store display and pay the cashier a one-time purchase fee plus the initial amount they would like to load onto their card. Consumers then go online or call a toll-free number to register their personal information with it so that it can activate their temporary prepaid card and mail them a personalized GPR card. Consumers can then reload their personalized GPR cards using a MoneyPak or, at enabled retailers, through a point-of-sale (POS) process. Funds can also be loaded on the card through direct deposit of a customer’s government or payroll check.
The Company’s GPR cards are issued as Visa- or MasterCard-branded cards and are accepted globally by merchants and other businesses belonging to the applicable payment network, including for bill payments, online shopping, everyday store purchases and automated teller machine (ATM) withdrawals. It has instituted a simple fee structure, which includes a new card fee, a monthly maintenance fee, a cash reload fee and an ATM withdrawal fee for non-MoneyPass ATMs. Its free services include account management and balance inquiry services through the Internet, telephone and mobile applications. For regulatory compliance, risk management, operational and other reasons, its GPR cards and reload products have certain limitations and restrictions, including maximum dollar reload amounts, maximum numbers of reloads in a given time period, and limitations of uses of its temporary cards versus its permanent personalized cards.
The Company provides co-branded GPR cards on behalf of retail distributors and other business entities. Co-branded cards bear the trademarks or logos of the retail distributor or business entity, and its mark on the packaging and back of the card. These cards have the same features and characteristics as its Green Dot-branded GPR cards, and are accepted at the same locations. Representative co-branded cards include the Walmart MoneyCard, the Kmart Halogen Prepaid MasterCard cards, and the AARP Foundation Prepaid MasterCard.
The Company generates cash transfer revenues when consumers purchase its reload services. It offers consumers ways to reload any of its GPR cards and to conduct other cash loading transactions through its reload network, using its MoneyPak product or through retailers’ specially-enabled POS devices. MoneyPak is offered in all of the retail locations where its GPR cards are sold. MoneyPak is cash reload product, which it markets on a display like its Green Dot-branded GPR cards.
Cash reloads using a MoneyPak involve a two-step process: consumers pay the cashier the desired amount to be reloaded onto the MoneyPak, plus a service fee, and then go online or call a toll-free number to submit the MoneyPak number and add the funds to a GPR card or other account. Alternatively, at many retail locations, consumers can add funds directly to their Green Dot- branded and co-branded cards at the point of sale through a POS swipe reload transaction. Unlike a MoneyPak, these POS swipe reload transactions involve a single-step process: consumers pay the cashier the desired amount to be reloaded, plus a service fee, and funds are reloaded onto the GPR card at the point of sale without further action required on the part of the consumer.
The Company competes with American Express, First Data, NetSpend, AccountNow, PreCash, UniRush, LLC, Western Union, MoneyGram, Visa, Blackhawk Network, Inc. and Incomm.
Green Dot Corp
605 East Huntington Drive
MONROVIA CA 91016