15
Jan
gobank

Did you know it's national "new mobile banking day?" Because I surely didn't. First, Simple brought its online-only banking setup to Android, and now Green Dot has announced its own bank, which was designed from the ground up specifically for smartphones. Intriguing, no?

GoBank is pretty similar to Simple in a few new ways: it's online only, designed for mobile use, and turns the traditional banking system on its head. From there, though, GoBank branches off and does its own thing. For example, you can choose how much your monthly fees are – from nothing at all to $9 a month. It's your call. I think that's pretty neat.

And that's almost the extent of it when it comes to GoBank's fees: there's a foreign transaction fee of 3%, out-of-network ATM fee of $2.50, a $1 balance inquiry fee, and an optional $9 custom debit card fee. No overdraft charges. No minimum balance. None of the crap that most people hate about their banks.

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Right now, GoBank is [expectedly] invite-only. If you want to give it a shot, you can head here to get in line. Or you simply install the app below and sign up there. Neato.

SAN FRANCISCO--(BUSINESS WIRE)--Green Dot Corporation (NYSE: GDOT) today introduced GoBank, the first bank account designed from scratch to be opened and used on a mobile device. Launching in limited release, with general availability to come later this year, GoBank is fast, fair and feature-rich, allowing consumers to interact with their money in a way that’s immediate, intuitive and intimate. In addition to GoBank’s consumer-friendly pricing model of no overdraft fees or penalty fees and no minimum balance requirements, GoBank makes it easy to send and deposit money, build a budget and find an ATM, with a massive network of more than 40,000 fee-free ATMs, more than twice the size of Chase or Bank of America2.

As a brand of Green Dot Bank, Member FDIC, all GoBank deposits are FDIC-insured. Each GoBank account includes a checking account with a linked Visa debit card and a second integrated bank account called the “Money Vault” that’s designed to be an easy way for GoBank members to put money away for savings. Accounts are demand deposit accounts(DDA) with deposits insured by the FDIC and full “Regulation E” consumer protections.

“Until now, banking is one of the few industries in the world that hasn't yet been reinvented by Silicon Valley,” said Steve Streit, founder and CEO of Green Dot. “Most people today, and especially people under 40, aren't satisfied with their current banking options. Many traditional bank accounts have long and complex fee schedules with terms and conditions that favor the bank; not the customer. GoBank is made to please the customer first and foremost. GoBank is designed from the ground up to be the bank account for the smartphone generation. Once you start using GoBank, controlling your money becomes as intimate and addictive as checking Facebook or texting friends.”

GoBank features include:

  • Debit Card Customization: Members can personalize GoBank by customizing the entire front of their Visa® debit card with their favorite photo. They can choose the picture from Facebook, their phone or computer.
  • Should You Buy It? Ask the Fortune Teller: “Remember that time you won the lottery? I don’t either.” This is a response a member might see from GoBank’s Fortune Teller if they try to spend beyond their budget. Fortune Teller cross-checks the price of an item with the member’s integrated GoBank budget, and if they can’t afford it they’ll be advised in real-time to pass on the purchase. The budget tool is fun for members to use, with tons of responses that aim to entertain as well as inform.
  • Huge Fee-Free ATM Network: Members can withdraw cash from more than 40,000 fee-free ATM locations in the U.S. As a market comparison, Chase and Bank of America each have less than 20,000 fee-free ATMs.2
  • Peek at Your Balance Without Logging In: The #1 reason a person logs into their bank account is to check their balance. GoBank allows members to use “Slide for Balance” on the app’s login screen to take at peek at their available balance without logging in (members opt into this feature).
  • Send Money: Members can instantly send money to friends and family at no charge through email, text message or even a private Facebook notification. Recipients don’t have to be GoBank members to receive the money.
  • Quick Account Set-Up: Compared to typically long processes associated with opening a traditional bank account, setting up a GoBank account can take just minutes. This includes the time it takes to create an optional custom Visa debit card with a member’s own photo.
  • Multiple Deposit Options: GoBank has a variety of ways to deposit money into the account. Members can deposit checks by snapping a photo through the app, and they can use a debit card to transfer some money from another bank account. Direct deposit is available for paychecks, federal benefits or tax returns. Lastly, members can deposit cash at select Green Dot retail partner locations nationwide - all for free.
  • Mobile Checkbook and Bill Pay: Members can pay any company or any person online or on their phone, and GoBank will mail a paper check to any recipient that doesn’t accept e-payments.
  • Money Vault: The Money Vault is an integrated bank account, with deposits insured by the FDIC, where members can easily put money away for savings. In real time, members can move money from their checking account available balance into the Money Vault for safe keeping. When they want to spend that money, the member can move it back in two taps and it updates their available balance in real time. The Money Vault is free to use and members can move money back and forth as often as they wish.
  • Robust Account Alerts: Members can fine-tune a wide range of notifications about their money to fit their needs – with alerts about specific transactions, as well as overall account updates.

“It’s not every day that you get the opportunity to bring a Silicon Valley approach to building a bank account,” said Sam Altman, executive vice president of Mobile for Green Dot. “Our GoBank product and technology team is populated by digital natives who grew up with the Internet and mobile phones being central to our daily lives. So, our goal was to reinvent personal banking and create a bank account that understands how people in our generation live, work and play and how we think about money. We love using GoBank and we hope that our members will love it too.”

State of the Bank – Survey Conducted by Harris Interactive

Illustrating the need for GoBank’s unique approach, a survey conducted by Harris Interactive called “The State of the Bank” was released today by GoBank. The survey depicts an America that’s very open to a new way to bank. The survey found that almost 2/3 of Americans (64%) say they don't fully trust big banks. The majority of Americans don’t feel their bank is transparent (87%) or on their side (68%). In the past 10 years, Americans see Banking as being one of the least innovative industries – only airlines and pet care were seen as less innovative. And, only 11% of Americans say their bank frequently offers new tools or features that they use.

The survey shows traditional banking practices are fading, with 67% saying they write fewer paper checks, and 14% of 18-34 year-olds saying they’ve never written a paper check. As an indicator of Americans’ overall willingness to break away from traditional banking, 65% of people (and 81% of 18-34 year olds) indicated they’d be open to using a bank like GoBank (when presented with a description consistent with GoBank’s features). The full national survey results can be found here.

Pricing

According to a study3 by the Pew Charitable Trust, the average bank had 38 different fees that a customer could incur when using their checking account. And around 90% of all checking accounts had a monthly fee. The median monthly fee in the report was $12 unless the customer carries a sufficient minimum balance, which averaged $2,000.

While GoBank is one of the most feature-rich bank accounts on the market, its pricing is designed to be fair, simple and affordable. As such, GoBank has no overdraft fees and no penalty fees of any kind, ever. Nor does GoBank have any minimum balance requirements. In fact, while the average checking account may have as many as 38 different fees, GoBank has only four fees, which are:

1) Out-of-network ATM: GoBank has a very large fee-free ATM network of more than 40,000 locations. However, if the member uses an out-of-network ATM, there is a $2.50 charge for withdrawals and a $1 balance inquiry fee.

2) Foreign Transaction: If the member uses their GoBank debit card to make a purchase at a merchant outside the United States, there is a 3% foreign transaction surcharge.

3) Custom debit card (optional): If the member wants to order an optional customized photo GoBank Visa® debit card, there is a charge of $9. Of course, there is no charge for the standard GoBank debit card.

4) Monthly Membership (optional): GoBank charges no monthly fee. However, members can voluntarily pay a monthly membership fee in any amount they think is fair, from nothing up to a maximum of $9 per month. Making the monthly fee voluntary ensures that anyone who wants to use GoBank can become a member without being denied access based on their ability to pay. Allowing the customer to voluntarily pay what they think is fair gives the customer the power to “punish” or “reward” GoBank based on how they feel about the product. This provides an emotional benefit for the member because it puts them in control of their bank. Based on our product research, we believe that most GoBank members would contribute monthly if they liked the product.

Become One of GoBank’s First Members

Beginning today, anyone can request an invitation to join GoBank (visit GoBank.com and click “Join Now”). The first invitations for membership will also go out today to those who have requested to join. The GoBank App is also available as a free download from the App Store for iPhone or iPod touch, or Google Play for Android. To use the app, you must have an existing GoBank membership.

For a quick video overview of GoBank, check out GoBank’s YouTube channel. For photos and videos from today’s launch event, visit http://press.gobank.com.Information about GoBank’s fees can be found at http://GoBank.com/NoWorries.

Cameron Summerson
Cameron is a self-made geek, Android enthusiast, horror movie fanatic, and musician. When he's not pounding keys here at AP, you can find him spending time with his wife and kids, plucking away on the 6- or 7-string, or watching The Texas Chainsaw Massacre on repeat.

  • mgamerz

    I'd have to say Simple looks better, and gives me a better vibe.

  • Evan

    I'm really hesitant for both of these "start-up banks". I know they are both FDIC insured, but how do we know they'll have staying power? What happens if the bank needs to fold?

    I guess the thief I know is better than the thief I don't.

    • adi19956

      Doubt these will. Banks that fold deal with loans and savings or even investment. These guys just seem to hold your money. You can't get into debt with them nor them with you. Sure they could fold because they're paying too much for the use of cash machines, but I doubt it

      • Evan

        True, but how are they making money to keep the lights on? It seems like foreign transactions and out-of-network ATM fees are the only revenues of income.

        If they give you the option of setting your own fees, everyone will choose $0 unless there is a reduction in service for not paying a fee.

        I guess it is something that can be tested as a "goal savings" account...

        • adi19956

          I highly doubt everyone will choose $0/ month. A lot of people donate, I can't quote any numbers, but I bet they did their homework when deciding where their income was going to come from

        • itznfb

          Probably the same way Paypal does.... put a hold on your money and earn interest while it's on hold.

        • Thatguyfromvienna

          "If they give you the option of setting your own fees, everyone will
          choose $0 unless there is a reduction in service for not paying a fee."

          Not everyone is cheap.
          Same applies to apps.
          I have donated for many apps that work without any restrictions or ads because I want to support the people behind it all.
          I would gladly do the same for a bank if their service was good.

    • itznfb

      Simple is just a front-end for Bancorp. GoBank is a front-end for a prepaid Visa Card that essentially intakes your paycheck. I wouldn't trust GoBank as far as I could throw my car. Bancorp is a branch-less bank but at least it's a bank.

      • TweetrGuy

        US Bancorp owns US Bank so they do technically have branches.

        • itznfb

          I actually have an account with US Bank. I didn't realize they were owned by Bancorp but my positive experiences with US Bank gives me a little more confidence in Simple. Though I think US Bank operates independently of Bancorp Bank.

  • McLean Riley

    What is going on with the $1 balance inquiry fee? Every time you log in to see your balance you have to pay a dollar? That would be a pretty serious money maker, but no way anyone would pay that, right?

    • tB

      from what I just read, the dollar is only if you're off network. Just like the ATM fees

    • John O’Connor

      My sentiments exactly. could you imagine loading the app in a poor signal area. $1 everytime the screen refreshes!

    • ian_peterscampbell

      That fee is for balance inquiries at out-of-network ATMs. There's no charge for checking your balance in the app.

  • http://www.google.com/profiles/moneta.mace Mace Moneta

    Not a single word about security. For a smartphone app that I'm supposed to associate with real money, that's impressively frightening.

  • http://www.facebook.com/Shad0wguy Chris Jutting
  • duke nana

    no thanks, I still prefers my local bank.

    if something goes wrong with this online bank, where should I go for complaint ? international police ? (lol)

    with local bank at least I know when something goes wrong then just call local police :)

    • ian_peterscampbell

      Green Dot is a publicly traded US company. GoBank has onshore customer service representatives.

  • analyzethis

    Green Dot owns Bonneville Bank in Utah and they also process their own debit transactions. As a bank with less than $10 billion in assets they are not subject to Durbin interchange fee limits so transactions is where they make most of their money on this.

    They also have free cash deposits at any Walmart.