Green Dot Corp. announced on Sept. 29, that it is offering the Green Dot Secured Platinum Visa card. Customers do not need to have a bank account, but will need to deposit money to secure their credit line through a major retailer connected to Green Dot’s network.
Green Dot Corporation today announced the launch of the Green Dot Platinum Visa Secured Credit Card, a secured credit card that is designed to help people with no prior credit history or those with poor credit scores build a positive credit history. Since the card’s credit line is backed by the customer’s own security deposit held at Green Dot Bank, most anyone can apply and be approved for the card. No bank account is required to qualify. The customer’s payment performance will be reported to the three major credit bureaus, which, with good payment performance, can help cardholders build a better credit history over time.
The card will have an annual fee of $39, require a minimum deposit of $200, and an annual percentage rate of 19.99%.Credit lines will be determined by the size of the deposit that a customer puts down, up to $1,000. Customers will need to apply for the card online and then once they receive it, put down the security deposit at a major retailer.
The card likely will appeal to many in Green Dot’s prepaid and GoBank customer base, as many people who have challenges getting a bank account also have challenges with their credit. The growth of the product will depend on the ability of consumers to put down the security deposit and their ability to develop better credit. Green Dot has opportunities to help build up customers over time, if it can manage its data and execution well.
Overview by Ben Jackson, Director, Prepaid Advisory Service at Mercator Advisory Group
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