How does this BaaS offering compare to similar embedded finance platforms from competitors like Stripe or PayPal?

Overview of the new offering

• Product: Sesame Cash – a digital‑bank account that lets Credit Sesame users manage cash, earn interest, and access a suite of banking tools (e.g., ACH transfers, debit‑card issuance, budgeting insights).
  
• Technology partner: Green Dot’s embedded‑finance platform Arc (a “Bank‑as‑a‑Service” or BaaS stack that supplies the underlying banking‑license, core‑ledger, payments‑network, and compliance infrastructure).
  
• Target: Consumer‑facing fintechs that want a full‑featured, FDIC‑insured deposit account without building a bank from scratch.

Below is a side‑by‑side comparison of Green Dot Arc with the two best‑known embedded‑finance platforms from Stripe and PayPal (as of 2024‑2025). The comparison is organized by the most relevant dimensions for a BaaS partnership: product breadth, integration model, regulatory coverage, pricing & cost structure, speed to market, ecosystem & value‑added services, and typical use‑case fit.

1. Product & Feature Breadth

Takeaway: Green Dot Arc delivers a complete, consumer‑grade banking stack (deposit accounts, cards, payments, interest, compliance) that Stripe and PayPal do not yet provide natively. Stripe and PayPal excel at payments‑first solutions and merchant‑focused financing, but they still rely on partner banks for many core banking functions.

2. Integration Model & Developer Experience

Takeaway: Arc’s single‑API, end‑to‑end sandbox dramatically reduces integration complexity and time‑to‑market for fintechs that need a full banking experience. Stripe and PayPal require more custom development and coordination with multiple partners.

 3. Regulatory & Compliance Coverage

Takeaway: For consumer‑centric fintechs that need FDIC‑insured deposits and a single compliance umbrella, Arc is the clear leader. Stripe and PayPal can meet compliance needs for merchant‑focused payouts, but they do not yet provide a fully regulated banking layer for third‑party consumer accounts.

4. Pricing & Cost Structure

Takeaway: While the per‑transaction rates are broadly similar, Arc’s bundled pricing (setup fee, optional platform fee, and the ability to capture net‑interest revenue) can be more attractive for fintechs that want a monetizable deposit product. Stripe and PayPal typically pass the banking‑partner costs through, limiting the fintech’s upside on interest.

5. Speed to Market & Ecosystem

Takeaway: For a fintech that wants to launch a consumer‑grade digital bank quickly and leverage an existing banking charter, Arc is the fastest and most complete. Stripe and PayPal are better suited for merchant‑focused payouts, BNPL, and financing rather than a full‑featured consumer deposit account.

6. Strategic Fit & Ideal Use‑Cases

7. Summary – Key Differentiators

Final Verdict

• If your primary goal is to launch a consumer‑grade digital bank (deposit accounts, interest, debit cards, real‑time payments) quickly and under a single compliance umbrella, Green Dot’s Arc—as demonstrated by the Sesame Cash partnership—is the most comprehensive and efficient BaaS solution.
  
• If you are building a marketplace, gig‑economy platform, or a B2B SaaS that needs fast payouts, virtual cards, and merchant financing, Stripe’s Treasury/Issuing offers a more flexible, payments‑first stack with deep developer tooling.
  
• If you need a global, cross‑border checkout experience with built‑in consumer financing (BNPL) and a massive existing user base, PayPal’s Commerce Platform still leads in reach, though its BaaS capabilities for third‑party consumer accounts are limited compared to Arc.

In short, Arc positions itself as the “full‑bank” BaaS for fintechs that want to own a consumer deposit product, while Stripe and PayPal remain best‑in‑class for payments‑centric, merchant‑focused embedded finance use cases.