While Wal-Mart Stores is hoping consumers will spend big his holiday season, the retailer also unveiled a plan to help consumers sock away more savings for the future.
Working with Commonwealth Savings Group, consumers who have a Walmart MoneyCard debit account will be able to log in through the app or website and transfer money from their Walmart MoneyCard balance into a separate MoneyCard Vault, which is a free savings feature added to the service.
Wal-Mart discussed the new savings option in a blog post on the corporate website Thursday (Dec. 15). The retailer said the savings program has been in operation since August and since that time usage of the MoneyCard Vault is up more than 130%.
MoneyCard Vault users are, on average, saving 35% more. To entice consumers to use the new savings feature Walmart and card partner Green Dot upped the ante by promising monthly prizes through a sweepstakes program. Each dollar a customer saves in their MoneyCard Vault equals one entry in that month’s national drawing. The sweepstakes will award 500 cash prizes every month, including a $1,000 grand prize. Cash prizes are deposited directly to the winners’ Walmart MoneyCards. Walmart said 1,500 customers have won cash prizes.
“According to The Federal Reserve Board of Governors, nearly half of all U.S. families can’t cover a $400 emergency with their savings. That’s a reality we don’t want our customers to have to live with, and we thought we could help,” said Daniel Eckert, senior vice president of services at Walmart U.S. “Using our size and scale to take on issues that are affecting our customers is at the core of what we do. Along with Green Dot and Commonwealth, we think ‘Prize Savings’ can help drive change and address an important issue in a new, innovative way.”
Prize Savings is a first for retailers and an interesting play for Wal-Mart, according to analysts who say it’s another important step in the retailer’s efforts to woo customers into a Wal-Mart ecosystem. It’s also a differentiator from competitor Amazon.
“Millions of Americans have come to the Walmart MoneyCard to get control of their money, avoid overdraft fees, and not have to worry about a credit check to get a card,” said Steve Streit, chairman and CEO of Green Dot Corporation. “’Prize Savings’ introduces an opportunity for these customers to get even better control of their finances, encouraging them to build a safety net to protect themselves when they need some emergency funds and save for the future. By working with Walmart in this effort, we’re giving millions of our customers tools, and cash-prize motivation, to make that happen.”
Wal-Mart and Green Dot are relying on Commonwealth, a national organization dedicated to helping consumers save money through prize-linked products.
“Saving is the first step to ensuring financial opportunity and security,” said Tim Flacke, executive director, Commonwealth. “Prize Linked Savings programs have a proven track record of helping financially vulnerable Americans start and build savings and we are thrilled to collaborate with Walmart and Green Dot to expand the power and reach of PLS across the country.”
Commonwealth through its programs have helped more than 75,000 American consumers save $153 million, many of whom were first-time savers, the company said.