GO2bank seeks to provide people with easily accessible and inexpensive banking through its mobile app. It hopes to attract customers who don't use banks because they are too expensive or not accessible -- or people who are underbanked.
"Too many Americans struggle to access their money, are paying too much for financial products, and are negatively impacted by the lack of solutions designed to suit their needs," Green Dot CEO Dan Henry said. "GO2bank is built to be the go-to destination for seamless, affordable, useful banking -- combining the security, stability, and experience of an FDIC-insured bank with the innovation and agility of a leading fintech."
Green Dot officials point out that 7.1 million U.S. households, or 5.4%, were unbanked in 2019. Another 12% were using more-expensive methods like check cashers, money orders, and bill-pay services to manage their money.
GO2bank, which is FDIC insured, features low or no monthly fees, $200 overdraft protection, early access to paychecks, cash-back rewards, higher interest rates on savings accounts, and access to credit.
Henry said the past year "illuminated and accelerated" the demand for what he called "better digital banking."
Green Dot is one of the largest providers of pre-paid debit cards, but it is also a chartered bank offering banking as a service (BaaS) for Apple, Walmart, Intuit, Uber Technologies, and Amazon, among others.
The market reacted favorably to the GO2bank launch as Green Dot's stock price was up 7% in early trading on Wednesday. Green Dot has carved out a nice niche in pre-paid cards and BaaS, but the company has a real opportunity to drive further revenue from this growing mobile banking space.