NEW YORK – Wal-Mart Stores, the world’s largest retailer, has been adding financial products for people who don’t have bank accounts. Now it’s targeting those who do.
A prepaid debit card called Bluebird, created through a partnership with American Express, will be available in more than 4,000 U.S. Wal-Mart stores and online this week, the Bentonville, Ark., company said in a statement.
Services include direct deposit, automatic bill pay and remote check capture using a smartphone application. The card has no monthly or annual fees, and doesn’t require a minimum balance.
Bluebird is designed as a checking and debit alternative, Daniel Eckert, vice president of financial services for Wal-Mart U.S., said in an interview. The product is for those customers who are waking up to the skyrocketing costs of having a checking account.
Wal-Mart abandoned plans to start its own bank in 2007 amid opposition from legislators and financial-services companies.
At the time, the retailer’s application to open a so-called industrial bank in Utah would have enabled it to process credit card and debit card transactions internally.
The retailer has been adding financial services and products to boost store visits in the U.S. after so-called same-store sales declined for two years through July 2011, according to Matt Arnold, an analyst for Edward Jones & Co. in Des Peres, Mo.
Bluebird will probably appeal to the low-income consumers Wal-Mart depends on because they can often only afford basic accounts without such features, he said.
There’s still a huge piece of the population that doesn’t enjoy that, and for them this could wind up being a better alternative, said Arnold. The card appears to be created to increase store traffic and relevance rather than profit, he said.
U.S. sales at Wal-Mart fell in part because it removed items from the stores, making it less of a one-stop shopping experience, Arnold said. While Bluebird won’t have a major effect on results, it could help improve that aspect, he said.
Anything they can do that adds to the one-stop shopping opportunity will only help their relevance, Arnold said.
Bluebird had been tested in some stores in the United States since 2011.
During the pilot phase, Wal-Mart learned that its customers wanted the account to offer many of the services that banks offer without the fees, Eckert said.
U.S. consumers pay an average of $259 a year for a basic checking account, Wal-Mart said in the statement, citing a study by Bretton Woods.
Wal-Mart is further capitalizing on its push for Congress to cap debit-card swipe fees charged to merchants, a Dodd-Frank Act provision that has cut annual revenue at the biggest U.S. banks by about $8 billion.