Walmart Dips Its Toes into Instant Payments

Walmart’s expansion into personal finance continues with the announcement of its upgraded pay-by-bank offering, set to roll out next year. The service will allow Walmart customers to make instant transfers directly from their bank accounts for online purchases, sidestepping card networks and their processing fees. 

Pay-by-bank isn’t new for Walmart shoppers. The existing system, offered through Walmart Pay, took roughly three days to finalize transactions, which are processed through the Automated Clearing House. The retailer has deemed that iteration a success. “It’s certainly surpassed our expectations of the amount of customers that have registered and actually use the payment type,” Jamie Henry, Walmart’s Vice President of Emerging Payments, told Bloomberg News.

However, the new system offers a significant upgrade. Customers using pay-by- will see the transaction reflected in their account balance instantly, and Walmart will receive the funds immediately. As with the initial, this option will be available—for now at least—only to online shoppers through Walmart.com.

The transactions will use Fiserv’s NOW Gateway, which is integrated with both The Clearing House’s Real Time Payments network and the Federal Reserve’s FedNow instant payments service.

Industry observers believe this could showcase the power of pay-by-bank, not just for Walmart shoppers but for merchants as a whole.

“As the world’s largest retailer, Walmart could ignite instant pay-by-bank payments in the U.S.,” said Elisa Tavilla, Director of Debit Payments at Javelin Strategy & Research. “Real-time pay-by-bank could offer a number of benefits for consumers.”

“Besides enabling customers to see transactions reflected in their bank accounts instantly, retailers could also credit refunds immediately with real-time pay-by-bank,” she said. “Retailers could also pass along their savings in payment processing costs to customers who use pay-by-bank.”

For some time, Walmart has been working to integrate its proprietary personal finance tools into its offerings for shoppers. In April, the retailer introduced buy now, pay later loans through One, the fintech startup that is majority-owned by Walmart, moving away from an earlier partnership with Affirm.

Earlier this year, Walmart also parted ways with its longtime credit card provider, Capital One, which led to speculation that Walmart might use One to develop its own store-branded card.