Walmart Inc. is pushing on toward financial services.
The retailer said this week it was launching a fintech start-up with investment firm Ribbit Capital, marking a development that follows a year of record business in online sales during the COVID-19 pandemic. Most recently, Walmart reported in its third-quarter earnings that its e-commerce business had risen 79 percent that quarter alone.
The move to link up with Ribbit Capital to expand into financial services is seen as the latest in a line of investments the retailer has taken over the past decade or so to build out its e-commerce offerings, and, more lately, to capture the business of its increasingly remote customer base during the pandemic.
“For years, millions of customers have put their trust in Walmart to not only save them money when they shop with us, but help them manage their financial needs. And they’ve made it clear they want more from us in the financial services arena,” said John Furner, president and chief executive officer, Walmart U.S., said in a statement Monday.
“We’re thrilled to work with Ribbit Capital in a new venture to help us deliver innovative and needed options to our customers and associates — with speed and at scale,” he said.
The retailer has not yet disclosed detailed plans for this latest endeavor, and the company is still developing projects for the venture, a representative for the retailer said Tuesday.
“The new company is being developed to create a suite of digitally enabled financial products that are tailored to our customers and associates’ unique needs,” the representative said.
The move also ties into Walmart’s broader strategy of acquiring or linking with businesses in areas it is seeking to venture into, especially as it competes with other major online big box retailers including Amazon. The venture would also add to the retailer’s existing financial services offerings, including its Walmart card, Walmart Money card, check cashing and other services.
The retailer said the venture would be “majority-owned” by Walmart, and that its board would comprise Walmart executives and Ribbit Capital managing partner, with plans to bring on “independent industry experts,” according to the companies.
“Walmart has a relationship with millions of customers and associates built on trust, security and integrity,” Meyer Malka, managing partner of Ribbit Capital, said in a statement.
“When we combine our deep knowledge of technology-driven financial businesses and our ability to move with speed with Walmart’s mission and reach, we can create and deliver financial offerings that are second to none,” Malka said.