Green Dot (NYSE:GDOT) is the market leader in the prepaid debit card industry, with 4.5 million active cardholders in the United States. Besides offering its own branded cards, GDOT is the program manager for Walmart's MoneyCard (included in the 4.5 million total), which can also be bought either in-store or online. Finally, the company operates the Green Dot network, which handles cash transactions for more than 150 other prepaid cards.
Prepaid debits cards have traditionally been used on a short-term basis, but more and more are seen as low-cost substitutes for a checking account.
The company generates revenue from three sources: card fees, cash transfer fees, and interchange fees. Card fees consist primarily of an activation fee ($4.95...
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