Dive Brief:
- Green Dot is renewing a prepaid card partnership with Walmart through Jan. 1, 2027, the companies announced Tuesday.
- About 35% of Green Dot's second-quarter revenue came from sales at Walmart’s stores, according to an August securities filing. Shareholders typically watch negotiations between the companies closely.
- The companies also announced the launch Tuesday of a fintech accelerator program, TailFin Labs, to be majority-owned by Walmart.
Dive Insight:
With the deal, Green Dot remains the issuing bank and program manager of the reloadable MoneyCard, the U.S.'s largest prepaid account program, according to the companies' press release.
Financial terms of the deal were not disclosed Tuesday, but Green Dot executives can expect to face questions about it Nov. 7, when the prepaid card provider announces its third-quarter earnings.
Green Dot's CEO, Steve Streit, in a discussion Tuesday at the Money20/20 conference in Las Vegas, emphasized his loyalty to the company's partners.
"I would rather die than to disappoint a Walmart or an Apple or a Stash or an Uber or anyone else. Or a Green Dot customer who calls me at midnight because they got my cell phone off the internet, and is angry because this and that happened to their card," Streit told an audience in response to a question of whether he’s eager for a new challenge after two decades leading Green Dot. Streit spoke earlier Tuesday about his previous career in radio, where change is sudden and taste tends to be fickle. "As soon as I had a hot format, I’d immediately throw it away and try to invent a new format because I was always worried it wouldn’t be popular," he said.
Green Dot's partnership with the world’s second-largest retailer, in contrast, has become a bit of a constant. The renewal pushes their partnership on MoneyCard past the 20-year mark. (The two businesses launched MoneyCard in December 2006.) The deal would have expired in May had the renewal not come through. The agreement was last renewed in 2015. Walmart received a 6% larger share of the revenue generated under that deal, compared with the previous one.
TailFin Labs aims to develop innovative products, services and technologies that integrate omnichannel shopping for consumers and businesses with Green Dot’s banking-as-a-service platform.
"With this expanded relationship, and by leveraging Walmart's footprint and existing offerings with Green Dot's cutting-edge capabilities, we’ll be uniquely positioned to offer an unmatched set of customer experiences that sit at the nexus of omnichannel retail and tech-enabled financial services," said Daniel Eckert, senior vice president of Walmart Services and Digital Acceleration.
