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Walmart looks to fintech as new profit center

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Little Rock, Arkansas — Walmart has joined forces with several financial technology (fintech) startups with plans to create a “neobank” that will enable customers to manage money with lower fees.

In January 2020, Walmart announced a strategic partnership with fintech investment firm Ribbit Capital to develop and offer affordable financial solutions.

Ribbit’s investment portfolio includes Credit Karma, Affirm, and Robinhood. Walmart hired two Goldman Sachs execs to head up the new fintech venture named Hazel.

Walmart, last month acquired the financial startup Even Responsible and One, a digital banking alternative founded in 2019 by Brian Hamilton.

All the startups will operate under the name ONE, with Omer Ismail as CEO. According to the Walmart release on Jan. 26., the combined entity will have a workforce exceeding 200 people and have more than $250 million in cash on the balance sheet to advance growth.

“Consumers everywhere are being left behind by the world of financial services,” Ismail said. “Our vision is clear: build on Even and One’s success to offer a product that offers consumers the best way to spend, the best way to access their wages and helps millions save and grow their money.”

According to Walmart U.S. CEO John Furner, the fintech moves help consumers get paid early, spend, save, borrow and grow their money as ONE seeks to develop a super app once the deals close in the first half of this year.

The ONE app would be integrated inside Walmart’s physical and digital channels, offering options to its 1.6 million U.S. employees and 100 million-plus weekly shoppers, the retailer said.

According to Walmart, they would be available directly to U.S. consumers and through partnerships with other leading employers and merchants.

 

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