Denver-based Western Union has struck a deal with Bentonville-based Walmart to offer money transfer services alongside competitor Money Gram, which manages Walmart’s transfer services. Western Union said the move inside thousands of Walmart stores is a way to recapture some of the foot traffic it lost amid the ongoing COVID-19 pandemic.
Western Union will provide local and international money transfer services along with bill payments and money orders to Walmart customers beginning this spring. Western Union promises payouts “in minutes” to more than 550,000 retail locations, along with billions of consumer bank accounts, digital wallets and cards around the world, the company said.
Dallas-based MoneyGram also just renewed its contract with Walmart for three more years. MoneyGram manages Walmart-to-Walmart cash transfer service that is available to customers from 4,700 U.S. stores.
Walmart said through Western Union’s global cross-border, cross-currency platform customers can transfer money to 200 countries and territories across the globe. The retailer estimates since 2014 when the Walmart-to-Walmart transfer service kicked off, customers have saved more $1.5 billion in fees across its financial services offerings.
The financial services are aimed at the estimated 55 million unbanked or underbanked in the U.S., according to the Federal Reserve Bank. This was about 22% of U.S. households in 2018. A federal banking report in 2019 found the nationwide rates to be 7.7% unbanked and 17.9% underbanked.
The partnership with Western Union comes on the heels of Walmart’s plans to create a new fintech startup with Ribbit Capital to focus on adding more new and innovative financial solutions at scale at an affordable and sustainable price.