What does bill paying really mean at Walmart?

So what if Walmart hasn’t been able to establish a bank yet. The world’s largest retailer remains undeterred from getting involved with the financial business of its customers.

So what if Walmart hasn’t been able to establish a bank yet. The world’s largest retailer remains undeterred from getting involved with the financial business of its customers.

With the CheckFree Pay service (Fiserv, Brookfield, Wisconsin) now available, people can come into any of its 3,755 stores in the United States (including SAM’s Club) to pay household bills due to any of 2,500 different companies. Could this one-stop service for credit card, utility, phone and other payments bring incremental traffic to the stores? We at SupermarketGuru.com think that’s certainly one of the primary goals of this new convenience.

It would be valuable if it adds just one trip a month among the consumer segments likeliest to use this service. It could help steal trips from independent bill-paying shops, bodegas and convenience stores - all fixtures in the neighborhoods they serve, and all unable as individual businesses to match the fuller appeals of a complete Walmart store.

Once Walmart gets customers used to paying bills in the store, might the chain begin to offer check-cashing services so people would have cash or debit cards on hand to spend while there? 

Moreover, the company announcement says “payments are delivered electronically, which ensures a fast and secure transaction for Walmart customers. Payments flow quickly and seamlessly to the billing company via Fiserv’s secure electronic payment network.” 

And Jane Thompson, president of Walmart Financial Services, says, “Offering our customers the convenience of walk-in bill payments at Walmart helps them simplify the management of their day-to-day finances.”

We wonder though: Have regulators questioned whether any data is shared between Fiserv and Walmart that would give the retailer further insights into the spending, consumption and payment habits of these customers? Have firewalls been set up to protect the privacy of customers (even fully banked, more affluent customers) who might choose to consolidate their bill paying? 

Walmart has been extremely savvy in the past when it encroached on the food, pharmacy ($4 generics), and consumer electronics businesses. Why should this be any different? If by providing bill-payment services, Walmart is able to get a closer fix on shoppers’ financial condition, it could leverage those insights in countless ways. If this is a precursor to another run for a bank, the banking industry and regulators had best be ready.

Because we never underestimate the power of Walmart, we think a seemingly innocuous offer like bill-payment services could have far-reaching implications.