Walmart's Financial Services Benefiting From Americans' Frustration With Big Banks
It's not just local non-profit credit unions that are benefiting from anger directed at big banks -- the world's largest retailer is also getting a boost.
The number of customers taking advantage of Walmart's financial services -- which include check cashing for a flat fee, bill paying and even wiring money overseas -- has risen alongside the recent surge in outrage at big banks, The New York Times reports. Though the retail giant scrapped plans four years ago to get a federal bank charter, it’s quietly become a destination for consumers who are unhappy with their banks or simply don't have an account, according to the NYT.
A slew of unhappy customers and lawmakers eventually convinced Bank of America to earlier this month abandon its plan to charge customers $5 per month to use their debit cards for purchases starting next year.
And BofA wasn't the first to back away from a fee. Wells Fargo, JP Morgan Chase as well as other regional banks dropped plans to charge consumers for debit fee use after watching the outrage unfold, the Wall Street Journal reports.
For some angry at bank fees, Walmart could become a one-stop shopping for their financial needs. H&R Block, the tax prep services firm, announced last month that it would open kiosks in hundreds of Walmarts across the country to assist customers with their taxes. The company also started offering a Discover credit card in 2005, according to Businessweek.
Debit card fees or not, some consumers have opted to move their money elsewhere. Saturday marked the deadline of a social media push to encourage consumers to pull their savings out of banks and push it into credit unions. Tens of thousands said last week that they planned to attend the Bank Transfer Day event and protests commemorating the day took place in Los Angeles, Denver and elsewhere across the country.
At least 650,000 people opened new credit union accounts from September 29 -- the date Bank of America announced its debit card fee -- through the first week of November, according to the Credit Union National Association. That’s more than the 600,000 customers who opened new credit union accounts in all of 2010.
The retail giant has been in the business of providing financial services for more than five years, but access to financial products isn't the only way the company keeps consumers in its store. Customers can get their car batteries checked and installed at some Walmart locations, to name just one of many examples; they can also get an eye exam in Walmart vision centers.
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First Posted: 11/08/11 03:28 PM ET Updated: 11/09/11 08:43 AM ET