Major Negative Changes to Mango 6% APY Prepaid Account

Mango Changes

The Mango 6% APY prepaid card has announced two important changes in their terms:

  • New requirements to become eligible for the 6% APY rate
  • Each person can have only one Mango account going forward

Direct Link

The new terms will go into effect on September 1, 2016.

6% Gets Tougher

There are two changes in the requirements to become eligible for the 6% interest rate:

  • You need to direct deposit/ACH $800 into the account. Previously, only $500 was necessary.

So far, nothing terrible; just an extra $300 to cycle through.

  • Any money pulled out of the account via ACH does not count toward the $800 direct deposit requirement. ACH includes bill payments, ACH pulls, or any other form of ACH transaction.

Mango wants us to spend down the money in the account using the linked debit card, not ACHing it out. Starting September, in order to be eligible for the 6% rate, we’ll have to leave the money in the account or spend it down using the debit card.

You can still ACH money out of your Mango account, but if you do, it won’t count toward the $800 requirement, and you won’t earn 6% APY. For example, if you ACH/DD $800 into the account, then ACH $100 out of the account, you won’t earn 6% APY.

On the surface, it would seem the card is completely useless since we all use reward credit cards for daily spending. But as we know, there are many places we can run up spend on a debit card, including PIN-based transactions (money orders, load prepaids), among other debit-only transactions.

Going forward, the only way it would be worthwhile for someone to keep the 6% account is if you have an easy way of racking up $800 in spend each month.

Keep it for the 2%

It’s also worth remembering that Mango does offer a very competitive 2% APY rate on up to $5,000, even if you don’t meet the direct deposit requirement. Consider keeping the account for the 2% rate even if you can’t meet the new direct deposit requirement.

Complicate Things & Win

It’s been noted that if you complicate life a bit, you can still get the 6% rate most of the time.

If you don’t fancy buying money orders, consider ACHing $800 in each month and only pulling out the money once each quarter.

For example, ACH $800 into the account in September, then $800 in October, then $800 in November. After the November deposit clears, pull out the full $2400 via ACH in one shot.

You’ll end up getting the 6% rate for September and October, and the 2% rate for November. Using this approach, you can get 6% APY eight months of the year and 2% the other four months.

Another option is to buy $2400 of money orders quarterly, the idea being to limit the number of times you need to visit a money order vendor. Using this approach, you’ll get the 6% rate the entire year.

Neutering Multiples

The other change soon to take place is that each person is limited to having just one Mango Savings account; previously, it was possible to have multiple accounts. You can continue have more than one Mango prepaid card account, but only one Savings account.

The account which had the highest daily balance during June 2016, will remain open, and the others will be closed down with the balance transferred over to the connected prepaid account.

Final Thoughts

In the end, some people will find it easy to manufacture $800 in debit card spend, and others will find it hard. That will be the deciding factor for most as to whether they keep Mango or let it go. Some might opt to retain it for the 2% rate or to do the every-other-month approach.

First Netspend died, now Mango is much less lucrative. Sigh. Not many easy options remain. See the post “Which High-Interest Savings Account Should I Get?” for a roundup of other high-yield options.

Hat tip to reader Don and to this Reddit thread 

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tim
tim

I am having trouble to link mango by ACH. The trail deposit is not showing up after a long time. I have tried three banks and the account number is correct.
Any idea?

Demian
Demian

It wouldn’t be too hard for me to set up a $400 bi-weekly Direct Deposit, but the $3 fee and the hassle of unloading the additional funds without using an ACH transfer looks like a hassle. But Insight is gone. Anyone else using any other current active alternatives over 5%?

DB
DB

Was able to set up a $400 biweekly direct deposit & to add the Mango card as a funding source on my Serve account. Was able to move money to Serve then to my checking account with no fees, seems to be working.

Ted
Ted

Sorry for a newbie question, but I have not received any interest on my savings account. I started with $5000 in the account and have been ACHing $800 into my spending account for the last four months and then transferring the $800 into my savings account. On all my monthly statements, it lists 0% interest for the month. What am I doing wrong? I would call CS, but I am always experiencing long waits. Any help would be greatly appreciated!

Mike
Mike

You should call them. At the very least, even if you somehow messed the steps up you should have earned 2% in any given month.

mangouser
mangouser

Today (May 1), all 5k was transferred to spending acct from savings acct like others who have posted (I didn’t transfer it). In addition, my password was changed (to what, I don’t know), but I reset using card info, and then the pass was changed AGAIN, and reset again. Definitely something Mango is doing. I have a feeling they are kicking users out who aren’t “using” the card as intended and milking it for the 6% (for those who don’t know, the effective interest rate less the $3 monthly fee and money order fees (and opportunity cost of the $800 per month) is close to 5%, just like Insight, and you don’t have to juggle $800 a month or $2400 every three. If they don’t let me use the acct anymore, I’m considering getting an additional Insight acct.

HarryTheFirstHarry
HarryTheFirstHarry

I’m new to Mango and once this current storm about txt messages from mango clears, I’m thinking this is one account to open and start putting 800 every month for 6 months before having to do any kind of jugglery. Its in month 7 that the jugglery has to take place where there needs to be a 2400 withdrawal and then continue the 800 ach-ins for another 3 months then withdraw another 2400 and so on. Still a good place to park 5K with no need for debit card transactions…only have to keep an eye for the bank’s own jugglery such as switching banks and sending texts after the fact.

HarryTheFirstHarry
HarryTheFirstHarry

ok I guess I missed the $3 monthly fee that is unavoidable and to answer my own question, not worth it (to start with just 800 in the first month). Have to put in 2.5K to start with and and then do the 800s every month thereafter for the next 3…even then return is not really 6% after the fee…more like 3.3% increasing to 5.3% in the 3rd month, then dropping to 2% for 4th month and so on. Still average rate is better than most other UN-gaurenteed savings accounts or 1 year CDs out there at this time. To think if its worth the effort.

Nick
Nick

Strange after weeks of same error I try my spouse’s info and it worked 1st try lol. What the heck??

Minnie
Minnie

Their website indicates that referrals are possible. If you post your referral code here, I’ll happily use it to sign up for my own account.

Doug
Doug

Pls check your accounts , today both my accounts money got transferred to check card and saving account balance is zero.

vivian
vivian

ok,I just check the website,it’s 5k maximum.
forget my confused

vivian
vivian

A little bit confused,if I put in 800/month for 12 month ,it’s 9600/year,then I can get 6% APY ?why I need take 800 out?

Nick
Nick

I have been trying to sign up since they started taking new applications. I cannot make it past the sign up. I keep getting error messages. Anyone been successful? I have tried multiple devices connections but I always get
Error Occurred: We are unable to verify the details provided. Please verify the details submitted above and try submitting your application again.

cg
cg

Open to new applicants again

max
max

Hi
New to high APY checking accts. Can’t I just transfer in a large balance (5k) and leave it in there for the 5%?