Wal-Mart may have abandoned plans to open its own bank, but the retail giant hasnt given up on financial services. The company has announced plans to offer a prepaid Visa debit card, called the MoneyCard.
Customers without credit cards or checking accounts will be able to reload money into their account and use the card like a normal debit card.
Customers will be able to reload their cards at over 1,000 Wal-Mart MoneyCenters located in about a quarter of Wal-Marts stores, by the end of 2008. The cards will be good anywhere Visa is accepted, as well as at ATMs, the company said.
Many of our customers are paying too much, traveling too far and not being well served, said Jane Thompson, president of Wal-Mart financial services. But they still need to pay their bills, cash their checks and transfer money. Were offering them a safe place and a card to help them manage their money. Weve seen firsthand what a difference that can make. It changes lives.
Wal-Mart says it currently conducts more than two million money services transactions each week. It estimates that last year, customers who used Wal-Marts services saved an average of $450 per year, or almost $40 per month.
The $40 our customers save each month can grow to become the down payment on a house or help pay for a childs college education, said Thompson. Thats our goal to help our customers prepare and save for the future by giving them access to greater financial opportunities.
The service to customers is not free. Consumers will pay an upfront fee of $8.94 to purchase and activate the card, then pay a monthly $4.94 maintenance fee. The maintenance fee can be avoided if consumers deposit at least $1,000 a month into their card account.
The fees are cheaper than many consumers would pay for a low-balance checking account.
Wal-Mart estimates that 20 percent of its current customers do not have a checking account and are prospects for its MoneyCard.