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.
“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