Magic, Orman Cards Exit the Market (June 17, 2014)
After splashy debuts two years ago, two celebrity-backed prepaid cards quietly are exiting the market this summer. The Approved Card from financial guru Suze Orman and The Magic Card, created by Hall of Fame NBA star and entrepreneur Earvin “Magic” Johnson, are calling it quits effective July 1 and June 30, respectively.
The New York Times first reported on the demise of the Approved Card yesterday, citing a letter sent by the issuer to cardholders, encouraging them to spend the remaining balances on their cards before that date. After that, the bank will send checks to cardholders for remaining balances, the Times said. Meanwhile, the Magic Card has a notice posted on its Website that the card is being discontinued and cardholders also will receive checks for any unused balances.
The Approved Card GPR MasterCard was launched in January 2012, featuring a $3 monthly fee, along with free cardholder access to credit scores via a partnership with TransUnion. Orman—who invested more than $1 million of her own money into developing the card—had been working with credit bureaus to determine whether cardholder behavior on the Approved Card could help consumers build credit.
The Magic Card also came to market with plans to improve consumers’ financial lives by encouraging saving through its MAGIC Mojo savings goal account and Piggymojo program, which celebrated with cardholders every time they saved.
Not many celebrity-backed prepaid cards have stood the test of time. The major exception is Russell Simmons’ RushCard, which has been going strong for more than a decade, but the demise of the Approved Card and Magic Card suggest that it takes more than a high-profile name to create a successful, sustainable prepaid product. See related stories: