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NetSpend Corporation (NASDAQ: NTSP), is an Austin, Texas-based company that provides processing and marketing services for private and proprietary MasterCard and Visa prepaid debit cards. Oak Investment Partners is a major shareholder.
NetSpend was founded by Roy and Bertrand Sosa, along with their friend James Wright (who left soon after the company started); the two brothers were teenagers when their family moved from Mexico to the United States in 1986. Twelve years later, they launched NetSpend from their one-bedroom apartment with an initial investment of $750. The Sosa brothers believed there was a large market that was left un-served by traditional banking and financial institutions. NetSpend’s stated goal is to provide consumers who lack established credit or banking relationships with the security, flexibility and convenience typically associated with debit and credit cards.
The NetSpend product line includes debit cards that can be reloaded with funds; gift cards purchased in predenominated amounts that cannot be reloaded; and travel cards that can be reloaded a limited number of times and provide travel protection benefits tied to the cardholder's purchases.
NetSpend, in conjunction with Financial Service Centers of America is the first prepaid card processor to offer a savings account feature with their cards. According to the Austin Business Journal, the interest rate on the savings account was increased from .75% to 3% in October 2006.