Walmart Money Transfers Could Give Western Union a Run for Its Money

Walmart has slowly but surely been creeping into the financial space, offering more and more financial products traditionally offered by banks and credit unions. The Walmart MoneyCard is a popular option for the underbanked who might be wary of bank fees that come with a traditional checking account. At one point, there were even rumors of a Walmart mortgage lending program.

Walmart announced today that it is adding a new service to its range of financial products: store-to-store money transfers as part of its ongoing focus on serving the underbanked.

“Many of these [underbanked] Americans use money transfers as a critical part of maintaining household budgets when away from their family or to help others in time of need,” said Daniel Eckert, a senior vice president for Walmart, in a post on the company’s blog.

The Walmart-2-Walmart Money Transfer Service, powered by Ria Money Transfer, offers money transfers both online and between Walmart locations.

Walmart said in a press release that Walmart-2-Walmart Money Transfers will cost “up to 50 percent less than similar offerings on the market.” As the first retailer to offer a money transfer service, Walmart is making a move to compete with Western Union, MoneyGram and other money transfer providers.

Lower Pricing and Clear Fees Are Key Selling Points for Walmart-2-Walmart

Walmart’s move to offer money transfers came in response to customer demand for a simple, affordable money-transfer solution, Eckert said.

“After listening to our customers complain about the high fees and confusion associated with transferring money, we knew there had to be a solution,” Eckert said.

Walmart-2-Walmart’s money transfer fee system makes associated fees clear with a two-tier structure. Money transfers up to $50 carry a $4.50 fee, and all transfers over $50 carry a flat rate of $9.50. Walmart only offers transfers for amounts up to $900.

Other money transfer services’ fees continue to rise as the amount being transferred increases, Walmart found in a price comparison. For instance, a transfer of $500 might typically carry a charge ranging from $34.50 to $40, but with Walmart-2-Walmart it would cost $9.50 — a price drop of more than 70 percent.

walmart2walmart price comparison

“Walmart-2-Walmart brings new competition and transparent, everyday low prices to a market that has become complicated and costly for our customers,” Eckert said. “We’re doing what we do best – launching a new service that challenges the status quo and drives down prices for our customers.”

Walmart’s announcement of Walmart-2-Walmart Money Transfer Service has already had a negative impact on competitors, pushing Western Union’s stock down nearly 4 percent in just a a few hours.

Photo credit: Walmart