Green Dot 2014 Annual Report Download - page 11

the point of sale without further action required on the part of the consumer. Historically, consumers were also able to
conduct cash loading transactions using our MoneyPak PIN product, which prior to 2014 was offered in all of the retail
locations where our GPR cards were sold. We began phasing out the MoneyPak PIN product in 2014 and no longer
offer that product by the end of the first quarter of 2015.
Tax Refund Processing Services. TPG, our wholly owned subsidiary, provides the processing technology that
facilitates the receipt of a taxpayer's refund proceeds. We generate tax refund processing service revenues when a
customer of a third party tax preparation company chooses to pay their tax preparation fee through the use of our tax
refund processing services, whereby we deduct the cost of the tax preparation service and the cost of our processing
service from those proceeds, and remit the balance to the taxpayer per their instructions.
Our Distribution Channels
We achieve broad distribution of our products and services through distribution arrangements with more than
100,000 "brick and mortar" locations, online and through the leading app stores. Accounts issued by us or our network
acceptance members can be reloaded at these brick and mortar locations.
Most of our arrangements for brick and mortar locations have been in effect with our distributors for several years.
These retail distributors have contracts with us, subject to termination rights, which expire at various dates from 2015
to 2018. In general, our agreements with our retail distributors give us the right to offer branded and private label deposit
account programs and reload services in their retail locations and require us to share with them by way of commissions
the revenues generated by sales of these cards and reload services. We and the retail distributors generally also agree
to certain marketing arrangements, such as promotions and advertising. Our operating revenues derived from products
and services sold at the store locations of Walmart represented approximately 54%, 64%, and 64% of our total operating
revenues for the years ended December„31, 2014, 2013, and 2012, respectively. Included in these percentages are
revenues derived from the Walmart MoneyCard program, which represented approximately 38%, 45% and 49% of our
total operating revenues during the years ended December„31, 2014, 2013, and 2012, respectively.
Our Relationship with Walmart. Walmart is our largest retail distributor. Green Dot Corporation has been the provider
of Walmart-branded GPR cards sold at Walmart since the initiation of the Walmart MoneyCard program in 2007, and
Green Dot Bank has been the issuer of those cards since early 2014. Pursuant to our agreement with Walmart and
Green Dot Bank, Green Dot designs and delivers the Walmart MoneyCard product and provides all ongoing program
support, including network IT, regulatory and legal compliance, website functionality, customer service and loss
management. Walmart displays and sells the cards and Green Dot Bank serves as the issuer of the cards and holds
the associated FDIC-insured deposits. All Walmart MoneyCard products are reloadable exclusively on the Green Dot
Network. In 2013, we began offering our Green Dot-branded cards at Walmart, providing consumers the choice to
purchase either Green Dot-branded cards or any of the Walmart MoneyCard products, and during the fourth quarter
of 2014, our GoBank checking account product was launched and made available in a retail setting at Walmart. In
December 2014, the contract governing our role as program manager and bank issuer for the Walmart MoneyCard
program was extended, under the same economics, terms and conditions, to December 31, 2015.
Tax Preparation Businesses. Our tax refund processing services are available to consumers through tax preparers
in three core distribution channels: Franchise tax preparers, independent tax preparers utilizing professional tax
software and taxpayers utilizing online tax preparation services. In general, our distribution agreements consist of
revenue-sharing arrangements under which we allow our channel partners to access and utilize our processing and
settlement technology as part of the tax preparation process. When our processing technology is utilized, a fee is paid
by the consumer that is shared, subject to various terms of each particular distribution agreement, between the
distribution partners and us.
Direct Channels. An increasing portion of our account sales are generated from digital and direct mail customer
acquisition sources and we expect this trend to accelerate over time. Customers who acquire our accounts through
these channels and pass identity verification typically receive an unfunded card in the mail and then can reload the
card either through a cash reload or an ACH deposit transaction.
Network Acceptance Members. A large number of program managers that offer their own prepaid cards accept
funds through the Green Dot Network. We provide reload services to more than 120 third-party prepaid card programs,
including programs offered by UniRush and H&R Block. MasterCard’s RePower Reload Network also uses the Green
Dot Network to facilitate cash reloads for its own member programs. In addition, we provide reload services to other
kinds of financial services firms and their customers.
3