Bankers have long been concerned that Walmart, as it has done in retailing, might disrupt the financial services business if the government allows the company to open its own bank. Minutes from a Dec. 19 meeting of the Federal Advisory Council, obtained under the Freedom of Information Act by Bloomberg News, shows the concern has not waned.
It was suggested by attendees of the meeting that Walmart might seek to find some type of "back door" to enter the financial services business without facing the same regulations of traditional firms.
Concern seems to be related to efforts such as Bluebird, a joint program with American Express. Bluebird allows unbanked Walmart customers to gain access to a prepaid debit card that doesn't require a minimum balance or impose fees for in-network transactions. Bluebird holders who use out-of-network ATMs are charged for transactions. Consumers can do direct deposits from their place of employment or use a smartphone to photograph checks. Holders of the card can also do automatic bill payments and person-to-person transfers.
The company dismissed the notion that somehow its financial services programs are regulated differently than banks.
"The financial services products offered at Walmart stores are properly regulated," Deisha Barnett, a spokesperson for the chain, said in an e-mail to Bloomberg. "In many cases, the regulated entity is the financial services partner."
Walmart, as well as Home Depot and Target, found its attempt to acquire an industrial loan company in Utah was met with fierce opposition from the bankers. Two years after first submitting its bid in 2005, Walmart withdrew.