Walmart Plans Instant Bank Payments, Cutting Out Card Networks (bnnbloomberg.ca) 25
An anonymous reader quotes a report from Bloomberg: Walmart customers will soon have the option to pay directly from their bank accounts with instant transfers for online purchases. The enhanced feature is a flash point in the escalating tensions between merchants and the card networks setting the fees for payment processing. The world's largest retailer has offered pay-by-bank through Walmart Pay since earlier this year. Until now, the transactions were akin to digital checks and took roughly three days to finalize when being processed through The Automated Clearing House, the same network often used for bill payments or paycheck deposits. Soon, customers opting for pay-by-bank transactions will see the purchase reflected in their bank account balance instantly -- and Walmart will receive the funds immediately. [...]
Walmart's upgraded pay-by-bank offering will be rolled out in 2025. The transactions will occur over bank technology provider Fiserv's NOW Network, which integrates with The Clearing House's Real Time Payments network and the Federal Reserve's FedNow. Until now, large retailers hesitated to launch real time payment options because many banks were not connected to an instant settlement system, meaning their customers would not be able to use the product. NOW Network aims to connect to as many banks as possible to reach 100% of deposit accounts by combining its own network with RTP and FedNow. The instant pay-by-bank product will be available for online checkout on Walmart.com. The Bentonville, Arkansas-based retailer already has customers set up a profile when they shop online. If they opt to add pay-by-bank as a payment option on their profile, they will enter their bank login credentials to connect their account. Fiserv's AllData platform connects with their bank clients and vendors including Plaid, MX, Akoya and Finicity to link and authenticate consumer accounts. With this instant pay-by-bank product, consumers will avoid stacked pending transactions, which can open them up to the risk of overdraft or non-sufficient fund fees from their bank. "When the transaction processes as a real time payment, customers get immediate access to see that payment come through, I see it hit my account and I can properly budget," said Jamie Henry, vice president of emerging payments at Walmart. "It's not as if I've got this phantom payment out there that's going to take place a couple days down the road."
Walmart's upgraded pay-by-bank offering will be rolled out in 2025. The transactions will occur over bank technology provider Fiserv's NOW Network, which integrates with The Clearing House's Real Time Payments network and the Federal Reserve's FedNow. Until now, large retailers hesitated to launch real time payment options because many banks were not connected to an instant settlement system, meaning their customers would not be able to use the product. NOW Network aims to connect to as many banks as possible to reach 100% of deposit accounts by combining its own network with RTP and FedNow. The instant pay-by-bank product will be available for online checkout on Walmart.com. The Bentonville, Arkansas-based retailer already has customers set up a profile when they shop online. If they opt to add pay-by-bank as a payment option on their profile, they will enter their bank login credentials to connect their account. Fiserv's AllData platform connects with their bank clients and vendors including Plaid, MX, Akoya and Finicity to link and authenticate consumer accounts. With this instant pay-by-bank product, consumers will avoid stacked pending transactions, which can open them up to the risk of overdraft or non-sufficient fund fees from their bank. "When the transaction processes as a real time payment, customers get immediate access to see that payment come through, I see it hit my account and I can properly budget," said Jamie Henry, vice president of emerging payments at Walmart. "It's not as if I've got this phantom payment out there that's going to take place a couple days down the road."
Other countries... (Score:4, Interesting)
Other countries have been doing this for years, Thailand for instance lets you scan a QR code to initiate an instant bank transfer, and the vast majority of retailers or even individual street vendors accept this payment method.
Also unlike a payment card, it's a push method - you confirm the amount you want to send rather than the retailer having the ability to pull any arbitrary amount from your account.
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Right. The main reason I discourage auto pay. It's either a credit/debit card or equivalent. Or my bank can send them a check.
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I'd be all for this if I received a price break for using it. Saving customers from "stacked transactions" is a bullshit excuse to offer this service for. Give me a 2% discount and I'm there. After all, what's the incentive for me? If I use my credit card, I can always get my money back if I have any problem with the transaction. Why should I pay the same price when using this service?
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To insulate against fraud and make detection simple, I only pay retailers with credit cards. You must have pretty light security on the phone you bank with, if you don't find your process tiresome to do each time you purchase something. I don't like to take my smartphone out in public, nor do I like paying for more than basic metered cellular plans. I also don't like closed source apps on my phone, especially the kind that refuse to work because Google play says that device isn't secure by Google's standard (which is letting Google be in control of your hardware).
Most of them use whatever is built in to the phone (eg fingerprint, face id) plus a pin.
How are you authorizing card transactions? also with a pin, or just the mere presence of the card (contactless), or something even worse like copying the random pen mark that's on the back?
A lot of cards now make you confirm transactions through their mobile app, or via an sms based OTP too.
I've never had a transaction differ from a receipt and if it ever did, I'm sure I'd have no trouble contesting the transaction.
It's not just rogue retailers you have to worry about, its compromised ones who let your card details end up in someone else's hands
EFTPOS? (Score:2)
Re:EFTPOS? (Score:4, Informative)
I don't even see how this is materially different from a debit card transaction... except you ("you" the Walmart customer) have given them your bank login info, like an idiot.
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Re: EFTPOS? (Score:1)
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except you ("you" the Walmart customer) have given them your bank login info, like an idiot.
I balked at that, too, when I read it. But I think the summary is misleading. I think your entering your credentials is done on the bank site and just to connect your bank account with this service. Much like when you enter your PayPal credentials, you're really not entering them on the site you're making a purchase from.
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Where do you think this magic 2% reward comes from?
I think the GP's point was that, at the end of the day, he receives 2% off in addition to other benefits. It's true that he's paying for it via increase price of goods, but if Walmart is not willing to decrease the cost of those goods by 2% if one's using this service, then it doesn't pay (at least for some) to use this service. Now if a vendor did offer me 2% discount for using a bank card, like you mentioned about oil change locations, then it would be a toss up, although even at 2% cash back vs. 2% dis
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So what you're saying is that everyone not using rewards cards is subsidising those who do...
In which case surely it makes best sense to use a rewards card, since you'll be paying the same as everyone else but you'll be getting 2% back.
Um... no thanks... (Score:4, Informative)
I have to ask... Walmart doesn't offer any real benefits for this. Why would I use their payment method only as opposed to like almost every single retailer, and using cards or other payment methods? Why would I add another vector for someone to drain my back account for one store?
Already, the WM shopping experience is miserable. If I want a taillight for a car, or a pair of socks, I have to wait a long time before a clerk can unlock the case. Then, the self checkout, where there are more loss prevention people standing around, hoping someone accidentally slides an item without paying for it... Combine that with the way reduced hours, and WM shopping is last on my list.
The last thing I'm going to do is give WM access to by bank account directly. At least they can bring back some sort of restaurant in their stores, like how Target has a Starbucks, and have some method to get stuff out of locked cabinets that doesn't entail waiting interminably for a clerk. There are better ways to do this, even if is paper tickets that one takes to the counter to be scanned. Maybe even consider bringing back 24 hour stores.
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If socks are locked up, that says something about the neighborhood you live in.
If you're paying with a credit card (Score:2)
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Visa & Mastercard aren't just for credit - why would they limit themselves, after all? Plenty of debit cards use the Visa & Mastercard networks as well - though they're often the fallback compared to other debit networks.
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you either don't have the money or you want the rewards points. Or you don't want to give a rando company direct access to your bank account, there's that too.
I have the money and don't want to have it debited directly from my account. A credit card gives me a one-month float on my money and consolidates things into into one monthly payment, which I *always* pay off in full. Though I can understand why some people may want (or need) a debit card, I will never want/have/use one, credit cards are much better for those who can use them responsibly.
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Well if you're paying with any type of card, you're giving them the ability to pull any arbitrary amount from your card any time they want. This is the whole reason why cards need to come with fraud protection guarantees, because fraud is so easy in that scenario.
In most countries paying with a bank account does NOT work like this. The retailer only provides you with their account number, a reference and optionally an amount often in the form of a QR code for convenience. You enter that information into you
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In the UK here, where pretty much everyone pays for everything by card, to the point that most people don't carry cash any more; I want the cashback, and the Section 75 protection.
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you either don't have the money or you want the rewards points. Or you don't want to give a rando company direct access to your bank account, there's that too.
There are many people that pay with a credit card for convenience. In many (most?) cases, if you pay your balance off at the end of the month you don't incur interest fees. Of course, the payment processor still takes whatever surcharge they're going to throw on. But I get consumer protections, ease of accounting like when it comes to the end of the year to do my taxes, and if I do run short one month I have a credit cushion. (Taxes come into play if you're in a situation like some 1099 employees where some
Useless for you (Score:2)
If you expect less to pay less I have bad news, someone in the payment processing chain will take just as much as the card issuers would. First they won't, but it will equalize. Here we have 0.45% tax on every transaction to begin with. Then banks add their own fees. Then the provider of the qr code.