Is George Lopez' Mango Card Worth a Bite?

NEW YORK ( MainStreet) -- George Lopez. Over the years, the name has become synonymous with comedy and the breaking of barriers for the Latino community. A few years down the road, it might be part of the nation's political discourse, as Lopez has expressed a desire to run for mayor of Los Angeles. At least for the moment, however, it's linked to prepaid cards.

Lopez and Mango Financial, whose primary offering is the Mango Prepaid Card, announced a multiyear marketing partnership Wednesday, ushering Lopez into the realm of celebrities turned prepaid card endorsers, which already boasts the likes of rapper Lil Wayne, businessman Russell Simmons and television financial adviser Suze Orman, who launched The Approved Card from Suze Orman in January.
Comedian and potential politician George Lopez has shown his financial side by backing a prepaid card issuer. But the card he's endorsing has some downsides.

While the others' forays into the world of personal finance have been met with varying degrees of criticism, primarily due to flaws with the products to which they lent their names, the court of public opinion is still in session when it comes to Lopez. How it rules depends largely on what the Mango Card offers and how it compares to the rest of the prepaid card market, namely the American Express ( AXP) Prepaid Card and Green Dot ( GDOT) Prepaid Card, which were identified as the best offers for teaching financial literacy and replacing your checking account, respectively.

Perhaps the most unique aspect of the Mango Card is the fact that it pays cardholders interest on their account balances. Those who sign up for direct deposit get a 6% APY for balances up to $5,000, and those who don't will get a 2% rate. Customer service is also completely free with the Mango Card.

Alas, it's not all positive. You see, the Mango MasterCard ( MA) will be prohibitively expensive for most users, largely because Mango does not have its own network of ATMs. Each ATM withdrawal will therefore cost roughly $4.33 -- Mango's $2 per transaction fee plus the average ATM owner surcharge. If you can take out cash at the store only after a PIN debit card transaction, though, you've got nothing to worry about. In addition, if you're willing to deposit at least $500 per month, Mango will waive the $5 monthly fee it typically charges.

Most consumers won't be able to make both of these commitments, though, especially since there are a number of other options at their disposal. This, of course, brings us back to the aforementioned Amex and Green Dot prepaid cards. Under typical use, as described in Card Hub's Prepaid Card Report, the Mango card would cost $6.92 more per month as a financial literacy tool than the Amex card. It would cost $10.66 more per month as a replacement checking account than the Green Dot card.

Could this extra cost be warranted, though? What if you got better perks in return?

After a full examination of the offer, it's clear the only way the Mango Card's perks will outweigh its costs is if you take advantage of its 6% APY and carry a very high balance. Unfortunately, this strategy doesn't seem to be sustainable -- the 6% APY is a promotional offer and Mango can revoke it at any time. The only other notable "perks" that come with use of the Mango Card and have not yet been mentioned -- RentSafe renter's insurance and GoalMine investing services -- aren't really perks at all. They are available to people who don't use the Mango Card, and it's unclear whether Mango cardholders get any sort of discount or added services.

As a result, there's ultimately little reason for most consumers to choose the Mango Prepaid Card over other offers. It will leave your wallet lighter without giving you too much in return, and no one wants that. This makes you wonder whether Lopez's endorsement was driven more by personal financial gain than a desire to represent a product that will truly help consumers.

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This article was written by Odysseas Papadimitriou, CEO of Card Hub, an online marketplace for all types of credit cards, prepaid debit cards and gift cards.