Walmart Gets Into Banking With No-Fee Checking
PITTSBURGH (KDKA) -- Move over PNC, Citizens, and those other banks.
Walmart is moving into banking.
"There's no monopoly on banking. If you have the capital and agree to play by the rules, anybody can create a bank," says Professor Tom Nist at the Duquesne University School of Business.
Walmart has partnered with Green Dot to create an online bank called GoBank, a low-cost alternative to traditional banks.
"With GoBank we tried to design a checking account from scratch so that it would be transparent, easy to understand, and just a more intimate way to bank," Alok Deshpande, chief product officer of Green Dot, told KDKA money editor Jon Delano.
Once enrolled for $2.95, customers get a debit card, paper checks if you want them, and, says Deshpande, "A really simple incredible mobile app that lets you pay your bills online, send money to people for free, snap a photo to deposit a check."
"Additionally, we took a 42,000 ATM network and made it free to GoBank members," Deshpande said.
It's free if you deposit at least $500 a month into your account. Otherwise, you pay $8.95 a month.
Walmart says its bank is aimed at those with lower incomes, those who shop here, those with lower credit scores, and even those folks who are tired of all those ridiculous banking fees.
"The average American is paying $214 to $315 a year when you add it up," says Deshpande. "The majority of that is coming from overdraft and penalty fees, and with GoBank we don't charge any of those fees."
"That would be attractive because most of the time banks charge you for every little thing," says Walmart shopper Phil Morrow of Moon Township.
"Lots of people overdraft all the time, and then those fees hit you and then it's one fee after another after another," adds shopper Caitlyn McDermott of Baldwin.
Prof. Nist says Walmart could threaten mainline banks.
"I think there could be some traditional customers, particularly younger ones, who see the convenience. It's going to be an online product, you don't really need a branch per se, and people might choose to give that a try," says Nist.
That's what Walmart is banking on.
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