Last week, the popular prepaid card provider Green Dot launched GoBank, a new bank account that emulates a traditional checking account but with a mobile-only interactions. Much like Simple, another mobile-based banking service, all deposits and payments are performed via a smartphone app or a debit card. However, where GoBank differs is that it is an actual bank (your deposits are not held at another bank on your behalf as with Simple).
How does it work?
Once you become a “member” of GoBank you’ll get a Visa debit card to use for payments and cash withdrawals. Their standard card is free, but GoBank heavily suggests getting a card with a custom image, which costs $9. The account doesn’t come with checks, but GoBank will mail a check to a third party for free on your behalf. Considering the time and hassle of writing a check to make a payment (not to mention postage) this feature seems particularly useful. For cash withdrawals, customers can withdraw for free from any of over 40,000 network ATMs nationwide. You can deposit money via electronic transfer or using your phone to scan a paper check.
The really interesting part of this account is the fee structure. There are no overdraft fees, and the $9 monthly fee is flexible, meaning the customer chooses what they would like to pay each month. This approach relies on the good-natured consumer paying what they feel is the true value of the service (perhaps dropping at times due to a poor interaction or rising due to a particularly positive one).
Is GoBank for you?
With no physical branches, and all transactions made directly via phone or debit card, this type of bank account could be a difficult transition for some consumers. Others, however, may already be using their checking account in a very similar way. In that case, GoBank could be an excellent option due to its lack of fees.
A few questions still remain: will consumers embrace an entirely mobile banking experience, and will they (given the choice) pay any monthly fee at all?
Learn more about GoBank