Finance

Wal-Mart Isn't A Bank. Yet.

Sam's Club, a division of Wal-Mart, will work with a finance company to offer loans of up to $25,000 to small businesses, the company said today.

It's the latest in the company's move into the world of finance.

When Wal-Mart applied for a bank charter a few years ago, regulators said no. A charter would have allowed Wal-Mart to take deposits and make loans.

But that rejection hasn't stopped the company from significantly expanding its financial offerings.

The actual lending in the new program will be done by Superior Financial Group, a federally regulated lender. But Sam's Club is promoting the loans, and members will get a discount on the application fee and on the interest rate.

And Sam's Club may expand the types of loans it offers through third parties, the New York Times reported over the weekend.

Sam's Club is a membership-based warehouse store, like Costco, and makes about half of its money from small businesses. Wal-Mart has also been expanding its finance offerings in its retail business.

The company plans to open 400 new "MoneyCenters" in U.S. stores this year. The centers offer services such as bill pay and check cashing.

And Wal-Mart recently took a minority stake in Green Dot, a finance company that manages the pre-paid debit cards sold at Wal-Mart. Those cards are often used by people without a traditional bank account.

“We’re not necessarily trying to be a bank, we’re just trying to bring to [customers], much as we do with products, the things they need,” a Sam's Club exec told the NYT.

Comments

 

Please keep your community civil. All comments must follow the NPR.org Community rules and terms of use, and will be moderated prior to posting. NPR reserves the right to use the comments we receive, in whole or in part, and to use the commenter's name and location, in any medium. See also the Terms of Use, Privacy Policy and Community FAQ.