Friday, March 30, 2018

Green Dot Cards- proving once again that it's very expensive to be poor

(First, I'd like to point out that comments are blocked for this YouTube commercial.  After reading a number of reviews of Green Dot, I'm not the least surprised.)

Browsing through, I encountered page after page of complaints concerning this thing called "Green Dot Prepaid Cards."  The most common issue involved accessing money placed on the card by the customer.  My immediate response was "why would you exchange cash for a piece of plastic which may or may not give you access to the money you used to buy the piece of plastic?  Does this make sense to anyone, anywhere?"

Then I did a little more research and learned about the customer base for Green Dot cards (the common "I got mine at Dollar General" was my first clue.)  It seems that Green Dot provides a service for a "specific market"- the "underserved customer" (more alarm bells going off, as "underserved customer" means "poor"- rich customers are never, EVER underserved.  Check out tomorrow's post if you don't believe me.)

People who don't have credit cards or bank accounts- like the well-dressed, home-owning suburban white woman in this ad (uh huh, sure)- can easily transfer their cash to a prepaid (by them) plastic card which can then be used anywhere credit or debit cards (or cash) are accepted.  If this sounds like circular stupidity, wait there does seem to be a benefit- when you get paid, your paycheck can INSTANTLY be added to your Green Dot prepaid card balance, "just in time for the weekend," so you can get your money when YOU need it.  Because without a Green Dot card there's no such thing as "Direct Deposit," you know. 

Also with Green Dot you avoid "interest fees" (and "interest") and credit checks and the annoyances of dealing with a bank- you know, like FDIC protection and and actual people you can talk to in person instead of an India-based phone bank.  Sure when something goes wrong and you can't access your money you might find yourself in deep trouble dealing with people on the other side of the planet for whom English is a second language, and sure these cards come with their own monthly fees (averaging $4.95 per month)  but hey that's the cost of convenience, right?

It sure looks like Green Dot and other "prepaid" cards are just another example of how big corporations just love squeezing the people living on the margins, the people who can least afford to lose any part of their cash flow.  I wonder if they are partners with Rent A Center and Payday Lenders, making up a financial Axis of Evil.  I know I'm preaching to the choir and I sure as hell don't want to sound like Dave "Just pay cash, just spend less, just make more money" Ramsey here, but I bet most people who use these cards are perfectly welcome to open accounts at their local bank but have been talked into thinking that they can't by their equally disconnected friends and neighbors.  I'll settle for urging all of them to just pop in to one of those banks next Saturday morning and check out what they have to offer. 

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