The concern by the Office of Thrift Supervision which culminated in its issuance of Supervisory Directive on Tuesday evening was not the product of a quick reaction.
MetaBank's partnership with NetSpend to offer the i-advance goes back for some time.
MetaBank's partnership with Santa Barbara Tax Products Group extends to tax season 2010. On August 10th, the two companies signed a new multi-year agreement. It signaled a new level of involvement. MetaBank agreed to offer refund anticipation loans through the facilitation of SBTPG.
We submitted an initial set of comments that we made to the Office of Thrift Supervision about MetaBank back in March.
Today, MetaBank's business model is facing a set of new challenges. They cannot make those refund loans for
SBTPG, and the OTS directive may even prevent them from offering refund anticipation checks. They are still debit card partners with NetSpend, for the time being. It remains to be seen if that relationship will be reduced even more.
NetSpend did not promise that they wouldn't seek a new partner for thier i-advance. There are several banks waiting in the wings, too.
NetSpend has an existing relationship with several other banks, including SunTrust, US Bank, and Inter National Bank. The latter is a subsidiary of Banorte and the bank partner for all of the savings accounts appended to NetSpend cards.
It is worth acknowledging that the OTS directive didn't put any restrictions on the actions of either NetSpend or SBTPG.