H&R Block Inc. announced that its new bank opened more than 2 million prepaid card bank accounts by the end of the 2007 tax season, doubling the company’s original projection.
According to the company, nearly 40 percent of those customers did not previously have a banking relationship.
Block reached its 1 million account goal back in early February, and said that customers are continuing to use the accounts, with more than $211 million in payroll and other funds deposited. In early February, deposited funds stood at $14 million.
The new accounts were made available only to tax clients completing their taxes in an H&R Block tax office.
When Block announced its plans to move into banking last fall, the company said that by offering bank accounts to customers, it would serve as a conduit to the direct deposit of tax refunds. Block had estimated that 3 million of its clients don't have bank accounts, forcing them to pay high fees for check-cashing services, and to make do without formal savings accounts.
Through tax season, Block estimated that the card had saved clients more than $60 million in check-cashing fees.
The accounts are accessed through the H&R Block Emerald Prepaid MasterCard, which also allows customers access to direct deposit services and an ATM network. Block also touts that its Federal Deposit Insurance Corp.-insured accounts eliminate set-up fees and transaction fees for purchases that some banks charge.
