Green Dot Retains Wal-Mart MoneyCard Account -- Update

By Josh Beckerman 

Green Dot Corp. reached an agreement with Wal-Mart Stores Inc. to continue as the issuing bank for retailer's prepaid reloadable debit card program for an additional five years.

The news sent Green Dot shares surging 29% to $19.76 in after-hours trading. The companies had worked together on Wal-Mart's MoneyCard program since its 2006 inception, but worries about the possibility of losing the business had helped push Green Dot shares down 25% so far this year through Monday's close.

Business from Wal-Mart locations made up 54% of the company's revenue in 2014, with about 38% of the total coming from the MoneyCard program.

Green Dot also worked with the retailer on last year's rollout of a checking account service called GoBank, which doesn't charge overdraft fees, unlike other the banks housed within the retail giant.

The new MoneyCard term, which became effective May 1, replaces an agreement that was previously extended to the end of the year.

Green Dot separately unveiled a stock buyback program on Monday worth $150 million. Its market value at the close was about $790 million.

Green Dot calls itself the largest provider of reloadable prepaid debit cards and cash reload processing services in the U.S.

Write to Josh Beckerman at [e-mail]

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