Walmart teases plans to become America’s biggest BANK

Walmart teases plans to become America’s biggest BANK: Retail giant will trial checking accounts for staff and some online customers, and could end up rolling it out to its 150m weekly customers

  • The superstore will be offering checking accounts to several thousand of its employees in the coming weeks as a part of a beta test
  • Walmart hopes to roll out banking options to its 1.6million employees within a year
  • Once the services have been made available to employees, Walmart would extend them to its customer base of at least 150million weekly shoppers
  • Loans and investments could also be a part of the financial services offered 

By Alex Oliveira For Dailymail.Com[1]

Published: 21:12, 14 September 2022 | Updated: 21:15, 14 September 2022

Walmart[2] will be testing out a new banking platform among a selection of employees and customers, a trial which could reshape the personal banking world should it prove successful. 

The superstore will be offering checking accounts to several thousand of its employees in the coming weeks as a part of a beta test, with the hopes of eventually handling the personal banking of its 1.6million employees within a year.

Once the services have been made available to employees, Walmart would extend them to its customer base of at least 150million weekly shoppers.

If successful, Walmart’s banking could leave rivals in the dust as it cashes in on its physical infrastructure of 5,335 stores across the US, which 90% of the population lives within 10-minutes of.  

Loans and investments could also be a part of the services offered, according to Reuters.

‘We want to be the best retailer – the first, best place where people come to shop,’ said Walmart CEO Doug McMillon. ‘But we also have aspirations to help improve their lives as it relates to health care and financial services – help families reduce the cost of money, save for the future.’ 

Walmart CEO Doug McMillon has previously said he wants to bring convenient banking options to the store’s millions of customers

Walmart teases plans to become America's biggest BANK

The superstore will be offering checking accounts to several thousand of its employees in the coming weeks as a part of a beta test, with the hopes of eventually handling the personal banking of its 1.6million employees within a year

The banking would be run by the fin-tech start-up One, which Walmart Inc. began forming with Ribbit Capital in January 2021.  

Walmart was unclear about its intentions when it started One almost two years ago, only saying it was designed to ‘develop and offer modern, innovative and affordable financial solutions,’ according to Bloomberg[3].

But in April the plan began to come into focus, as One combined digital bank account firm One Finance Inc. with early access wage provider Responsible Finance Inc.

One is run by former Goldman Sachs partner Omer Ismail, who left the bank after a nearly twenty-year tenure to join the start-up.

Though Walmart owns a majority share of One, it operates independently of the retail giant.

Walmart teases plans to become America's biggest BANK

The banking would be run by the fin-tech start-up One, which Walmart Inc. began forming with Ribbit Capital in January 2021

Walmart is betting on convenience and its massive customer base to carry the One venture through to success. 

With so many millions of customers regularly passing through so many thousands of locations on a daily basis, Walmart has an inherent leg up on any competition in the banking market.

‘Given the eyeballs that we have and the number of people who transact with us every week, customer-acquisition cost is actually something we already bring to the table,’ said Brett Biggs, former Walmart chief financial officer, at an investor conference last spring. ‘We should have lower customer-acquisition costs than other companies like that.’

The banking plan would cash in on Walmart’s bread and butter – retail – by offering 2 percent back on every dollar spent at the store, along with gas stations and drugstores. 

Walmart employees would also have access to their paychecks faster through a One account.

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References

  1. ^ Alex Oliveira For Dailymail.Com (www.dailymail.co.uk)
  2. ^ Walmart (www.dailymail.co.uk)
  3. ^ Bloomberg (www.law.com)