Amex, Walmart Launch Checking, Debit Alternative
A bird of a different feather? That’s what American Express and Walmart hope they have in Bluebird, a new alternative to traditional debit and checking accounts set to launch online and in over 4,000 Walmart stores next week.
The financial service giant and retail leader bill Bluebird as a simpler, cheaper way for people to conduct simple financial transactions and includes elements of prepaid, digital wallet and checking, savings and debit accounts.
Why do AmEx and Walmart feel as though Bluebird will appeal to consumers? They cite an independent study by Bretton Woods claiming that consumers pay an average of $259 a year for a basic checking accounts, thanks in large part to higher minimum balance requirements and an increase in fees.
A few weeks ago, Pew also revealed a study demonstrating the rising cost of checking accounts, and suggested that for many consumers, prepaid accounts would in fact be cheaper.
And that, in all likelihood, is what will draw consumers to Bluebird – a proposed system of reduced, transparent fees that make account set-up, money adding and cash withdrawal simple and cheap. A rough breakdown of fees included with the Bluebird press release lists set up from a debit card, ATM cash withdrawal, adding cash load packs and electronic bill pay as four of the only instances in which consumers might need to pay a fee at all.
According to the Bluebird press release, account holders will be able to deposit money via payroll direct deposit, remote check capture via mobile app, using cash at Walmart registers or through integration with an existing checking, savings or debit account. Bluebird offers digital wallet functionality such as P2P payments, mobile subaccount control and access to various American Express benefits. The release also notes that lost or stolen Bluebird cards can be replaced at no charge, and American Express protects the at-risk funds.
For Walmart, this indicates a further penetration of the unbanked, underbanked and prepaid industries. Last week, the world’s largest retailer announced a new three-year agreement with MoneyGram.