Now that it owns a bank, prepaid card provider Green Dot Corp. plans to offer checking accounts sometime in the second half of this year, according to press reports. The move is an interesting one for the company because its primary product has a reputation for drawing customers who cannot or will not get a traditional bank account.
Just as with the company’s prepaid products, the checking accounts would be marketed to consumers who make less than $75,000 a year. Streit didn’t offer any other details, but did say the goal was to design a checking account that diverges from the ones currently being offered by major financial institutions.
Despite Green Dot’s plans to offer a different kind of checking account, the question remains what the overall strategy will be. While the bank is well below the debit interchange restriction limit in terms of assets, it seems that a business model that relies solely on transactional revenues would not justify the addition of checking accounts. It leads one to wonder whether loans and other products are in the company’s future.