Judging by one of American Banker's latest awards, it seems one of America's big-box stores is beginning to compete with the country's big banks.
Jane Thompson, former president of Wal-Mart's financial services division, retired from the retailer this year, but she is still seeing the results of her work. American Banker named Thompson Innovator of the Year in 2011. Here's an excerpt from Maria Aspan's coverage:
Jane Thompson is not a banker. But during her nine years running Wal-Mart Stores Inc.'s financial services unit, she did more than any single bank or banker in the country to develop and sell affordable financial products to low-income customers.
Aspan continues to highlight that Wal-Mart appeals to customers with a number of services that most big banks do not offer. The stores' late-night hours extend much further than traditional banks, allowing customers to cash checks and transfer money outside of the typical 9 a.m. to 5 p.m. range. The article also mentions that many Wal-Mart employees speak languages other than English, which can make the retailer more friendly to non-native speakers.
I've devoted plenty of coverage to the rise of online banking and the latest mobile possibilities, but Thompson's award proves the need for face-to-face financial services is far from obsolete. Contrary to popular belief about the lack of profitability of low-income customers, the "many hundreds of millions of dollars" in annual profits at the retailer's financial services division also prove that those services can add a nice boost to a balance sheet.
In the wake of new bank fees, the online world is buzzing with plenty of consumers who have been considering ditching their banks altogether. While alternative financial services like Wal-Mart and Western Union do perform the basic banking services, my co-blogger Claes Bell covered that fees for one-time check cashing and prepaid cards do still add up.
Consumers will continue to take advantage of alternative financial services as companies like Wal-Mart get more creative about their offerings. Now, more than ever, it's important for these consumers to compare fees and options to make sure they aren't paying more than they would for a standard checking account.
What do you think? Would you use Wal-Mart for any of your banking needs?