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Testing New Ideas to Compete with Wal-Mart

January 17th, 2012 | Posted by Will Weidman in Uncategorized - (Comments Off on Testing New Ideas to Compete with Wal-Mart)

Wal-Mart has made big waves with its pre-paid debit card.  With over 4,000 locations that have a huge amount of traffic, any effort by Wal-Mart to offer financial products is instantly a serious threat to banks.  The $3 monthly fee for their debit card is highly competitive at a time when checking account fees have been rapidly increasing.  As a result, Wal-Mart has been stealing clients from traditional banks.

A recent American Banker article highlights how some credit unions have started to “embrace this trend by modifying their ATMs to sell fee-free stored-value cards.”  More banks should test these types of strategies to adapt to the rapidly evolving environment and compete against new threats like Wal-Mart.

This particular strategy may not be the silver bullet to win back or retain customers. (more…)