Prepaid debit cards just took a giant step closer to replacing traditional bank accounts. MPower Labs and its portfolio company Mango Financial, Inc. today announced that they will be offering a high interest savings account option for holders of the MangoMoney prepaid MasterCard.

In an announcement at the Underbanked Financial Services Forum in Miami, the founders of Mango Financial, Inc. announced the upcoming launch of a new savings feature that will be provided to all MangoMoney prepaid debit cardholders. The savings account will be available starting June 17, 2010.

The savings accounts will provide the following features:

• An APY of 5.1%, paid on balances up to $5,000.
• $1 Opening account balance required.
• Unlimited free transfers for allocating dollars to savings from funds loaded on their Mango prepaid cards
• Up to six free transfers per month to transfer funds from savings to their cards
• Savings account management features, including transfers, are available 24/7 online or by phone
• he integrated YAP(TM) service enables customers to check their savings balance or initiate card-to-savings transfers with a text message
• savings deposits are FDIC insured and held by Horizon Bank, SSB.

Savings accounts linked to prepaid debit card accounts have long been on the wish list of proponents of these cards. The savings account proposed by Mango Financial seems to meet or exceed everyone’s expectations, and the product will allow MangoMoney cardholders to enjoy almost all the features provided by a more “traditional” bank account.

Bertrand Sosa, one of the founders of Mango Financial (and one of the founders of the Netspend Corporation), explained the product as follows:

Given the importance of savings to reducing Americans’ reliance on debt and achieving long-term financial stability, we need better savings products and rates to make it worth their while. And we need more products designed with unbanked consumers in mind so they have better options for saving than stashing cash at home. If you’re doing the right things to manage your money, you deserve the right tools to help you do it. Our products and services are designed to allow our customers to keep more of their money and in this case, to put that money to work, whether it’s saving for the long term or budgeting for the next few months. We’re committed to providing our customers, many of whom may be new to savings products, a positive experience that encourages a lifelong practice.

We look forward to more prepaid debit card issuers following the lead of Mango Financial.