Walmart’s majority-owned fintech, One, is set to receive a fresh infusion of capital next year, fueling speculation about the future direction of the retail giant’s financial arm. The first step will be the relaunch of the Walmart credit card after the severing of an alliance with Capital One last year.
According to Bloomberg, One is seeking to raise $300 million through Ribbit Capital, the same firm that helped Walmart launch One in January 2021. The capital will likely support efforts to secure a replacement for Capital One, which handled Walmart’s credit card business from 2018 to May 2024.
Walmart’s huge customer base consists of approximately 255 million customers and members, many of whom have moderate incomes and are underbanked. This creates an opportunity for simple deposit accounts and other core banking services. Additionally, One also offers early wage access to Walmart’s more than 1.6 million employees in the US.
These individuals trust the Walmart brand, making them more likely to embrace an app that integrates not just bank accounts and credit cards but investment options as well. The trove of consumer data Walmart possesses further enhances the potential for innovative offerings.
One got its start in the consumer finance space in 2022 by rolling out checking accounts for Walmart employees and select online customers. Its savings accounts offered a 5% interest rate—well above the national average—as a strategy to attract more users and grow its business.
New Services
This year, One has helped Walmart add buy now, pay later (BNPL) to it roster of services, with pay-by-bank features scheduled for next year. The addition of BNPL presents a myriad of opportunities for cross-selling other products. The pay-by-bank offering will allow Walmart customers to make instant transfers directly from their bank accounts for online purchases, sidestepping card networks and their processing fees.
Some industry experts believe that pay-by-bank may not be attractive to Walmart customers, but the retailer says that earlier iterations—routing payments through the Automated Clearing House within three days—found support with its customer base.
“It’s certainly surpassed our expectations of the amount of customers that have registered and actually use the payment type,” Jamie Henry, Walmart’s Vice President of Emerging Payments, told Bloomberg News.
Integrating pay-by-bank functionality into One’s own digital wallet could enable seamless incorporation of loyalty rewards, coupons, and partnerships with other companies. It could also bolster anti-fraud measures by having user authentication integrated directly within the app.
