Blackhawk Secures a Slew of New Prepaid Contracts

Quietly, Blackhawk Network has been lining up agreements that will have a big impact on how consumers load money on to their prepaid cards.

Earlier in the month, Blackhawk reported that it has reached loading agreements with AccountNow, PreCash, NetSpend, Galileo and Ready Debit.

AccountNow, PreCash, NetSpend, and Ready Debit all act as MSPs for prepaid cards. Galileo is a payments processor.

On September 20th, NetSpend announced its new distribution contract with Blackhawk. Last May, NetSpend began using the Blackhawk ReLoadit product at more than 8800 stores in the United States. One of the virtues of Reloadit is price. It costs $3.95 to make a load at Reloadit, whereas some other entities charge $4.95.

Blackhawk is owned by Safeway and all of the 1,425 Safeway locations will soon have NetSpend cards. Retail presence is another important factor. Green Dot cards are sold at Wal-Mart as well as in many of the national drug store chains.

This week, Blackhawk signed up Green Dot. This is an interesting move, because Green Dot operates its own reload network. There is even the possibility that a BlackHawk-Green Dot loading arrangement will undermine Green Dot’s MoneyPak, as a MoneyPak reload can cost as much as $4.95.

Reloads are a very important factor in the cost of using a prepaid card. Some advocates spend a lot of effort toward trying to lower the monthly account fee for a card, when in fact just a few reloads will easily exceed the monthly fee. Most cards encourage cardholders to avoid those fees by signing up and using direct deposit.