An article in this month’s Fast Company magazine introduced me to Mango, an Austin-based financial institution that “lets people without a bank deposit checks, talk finances, and withdraw money – without ever opening an account.” With the tagline, “the fresh way to manage money,” Mango has launched a business that stems from a simple core product: The Mango MasterCard Prepaid Card. Perhaps the biggest difference between Mango and other financial institutions is the fact that a traditional bank account is not required.
Unlike many other prepaid cards, and as Mango’s tagline suggests, the card offers options in terms of money management. According to the institution’s website, card holders are able to load money to the card from direct deposit, a bank account, Green Dot MoneyPak (available at retailers nationwide), with a smart phone, and online from other Mango card holders. Card holders can manage their accounts online, by smart phone, or at a Mango Money Center store. Beyond the prepaid card, Mango is also offering a savings account offering 5.1% APY.
Based on the Fast Company article, it’s evident that Mango is focused on the customer experience. According to the article, “rather than treat the unbanked as transient customers, Mango aims to forge long-term relationships.” The article also discusses aspects of the branch, like the clearly stated fees presented on the wall or the self-serve kiosks, that contribute to this experience.
While Mango may be targeting people who are otherwise unbanked, it will be interesting to see if the business model attracts others who do currently have bank relationships elsewhere. According to an article in this week’s MarketingDaily, and a Mintel Compremedia study, 19% of consumers expressed interest in using prepaid cards to pay bills, as prepaid cards would allow them to avoid overdraft fees. The article goes on to say, “Of even more concern for banks is that the percentage of those willing to consider the prepaid cards increased among the affluent. Of households earning more than $100,000 a year, 25% said they would be interested in prepaid cards as a bill-payment option.” Perhaps Mango will appeal to part of this group as well.
With Visa also launching a new prepaid card campaign, not to mention the variety of other prepaid card options currently offered by financial services companies, Mango is certainly not alone in this effort. However, Mango’s approach – a business centered on the prepaid card – may prove to be a viable and sustainable business, especially in a post-recession marketplace. As Mango gains traction in Austin, it will be interesting to see if it moves into other markets, expands its product line, and if its customer base becomes a mix of unbanked and banked customers. I’d be curious to hear from anyone in Austin about the local marketing efforts and the actual in-store experience.