GoBank, the mobile-first bank account from Green Dot, doesn’t fully open its doors until summer, but it is adding users now with a viral marketing campaign.
The premise is simple: Send money to a friend, even as little as $1, using your GoBank account. Recipients can get their hands on the money by opening a GoBank account of their own and using the funds as an initial deposit, or sending the money to PayPal.
This viral strategy certainly paid off for PayPal, which now counts some 125 million users, but the payments world has grown much noisier since PayPal opened its virtual doors.
Bank Innovation was recently provided with a GoBank account and we’ve largely found the GoBank app to be user-friendly and functional, though with some limitations that may be beta-related.
GoBank’s product is a deposit account that does not earn interest — what is, these days? — and is accessed via mobile or online. Unlike Moven and Simple, both of which offer a similar product, GoBank is actually a bank. (Green Dot acquired the Bonneville Bancorp in 2011 for $15.7 million in cash.) This means the company could offer loans and credit down the road, according to Sam Altman, Green Dot’s executive vice president of mobile. However, the bank has prepaid in its DNA, and has made noise over not offering fees for overdrawing accounts, so perhaps credit is not in its playbook.
Outside the authenticated area, customers can use the app locate a free ATM and check their account balance with a simple swipe. Swipe-for-balance is a highly useful (and optional) feature that Bank of the West’s newly updated app also offers.
Within the authenticated area, customers are presented with options to update personal settings, including linking accounts to Facebook. This allows users to alert Facebook friends they’ve sent them money via GoBank just as they might over email or SMS.
Users can also customize how and how often they would like to receive alerts. A Daily Balance reminder sent by SMS is one option. Notifications can also be tied to Budgets, which are part of the bank’s PFM-like (personal financial management) capabilities.
Users can build budgets toward goals or anticipated expenditures, as well as anticipated deposits. There is also the Fortune Teller feature, which despite its kitschy name, is a common feature of PFM software: Given my budget situation, can I afford to buy that shiny new object?
Funds can be deposited to a user’s GoBank account by remote deposit capture of checks ($3000 maximum per 30-day period,) transfers from debit cards ($20 minimum,) and MoneyPak, a way of reloading Green Dot’s prepaid cards and sending money. Direct deposit is also accepted.
GoBank has a very simple person-to-person payment mechanism, which, as mentioned, is behind its current viral growth campaign. The app also contains a billpay solution and allows users to mail checks for free to merchants (or landlords, etc.) that do not accept debit payments. A billpay form is filled out and the check is mailed — the account holder never sees it.
Support options within the app are not robust, but that may be a result of the bank’s beta status. Under the Help section of the app, users are asked to choose a category and then sent to a browser-based Help page that is not optimized for mobile. This page also uses email rather than the more immediate chat, and provides a phone number.
Email is too slow for mobile, and the phone number should be more visible on the app. Also, users seeking support should not be ejected from the app experience. This can be expected to change when the bank opens its doors wider this summer, and GoBank Chat, currently listed as Offline on the site, goes online.
One area where GoBank falls short of rival Moven is in mobile wallet, or paying with the smartphone. While both companies issue plastic to account holders, Green Dot CEO Steve Streit has said that his company will take a wait-and-see approach with mobile payments. In an earnings call on February 1, Streit said,
I think Walmart and Apple are the only two companies big enough to change industries and whether they choose cloud, NFC or something in between, then everybody will know what to do with mobile payments. But until then, there’s nothing for us to do with mobile payments.”
It’s rumored Apple’s next phone will be NFC-capable, so will that sway Streit and company? Predictions for mobile wallet arriving on the scene in any measurable sense vary, but it doesn’t seem to be something a mobile-first bank can wait too long on. Moven has issued stickers containing NFC circuitry for iPhone users, an inelegant but practical solution that allows Moven account holders to pay with their phone — or at least, given the state of mobile wallet in the US, try. Could this be a case of Green Dot’s card pedigree holding back its mobile offering?
More importantly, how will Green Dot spread the word? Its viral idea is nice, but the number of beta testers is small, reportedly just several hundred. One way would be to leverage Green Dot’s card base. (The so-called underbanked who use prepaid products are actually more likely to own smartphones and use mobile banking than the general population.)
GoBank officially launched January 15, 2013. Green Dot CEO Steve Streit will update the financial community on GoBank at Finovate Spring in San Francisco next week.