Report: Walmart-backed fintech plans to enter buy now, pay later space
A fintech startup whose investors include Walmart will reportedly begin offering a buy now, pay later (BNPL) solution as soon as 2023.
According to CNBC, One, a fintech company jointly backed by Walmart and investment firm Ribbit Capital, one of the venture capital firms behind Robinhood, plans to launch a BNPL service that customers could use online and in-store at Walmart as well as other retailers.
[Read more: Walmart to create fintech start-up]
A source told CNBC that continued economic challenges and inflation are motivating the decision to roll out a new BNPL service. According to a recent study from Juniper Research, the number of BNPL users will surpass 900 million globally by 2027. This will mark an increase of more than 540 million users from 360 million users in 2022. Juniper Research data indicates this 157% growth rate will be driven by an anticipated economic downturn, which will increase the demand for low-cost credit solutions.
Interestingly, Walmart has been offering a flexible buy now, pay later ((BNPL) payment option with Affirm since February 2019, when it began allowing customers to use Affirm to make installment payments on purchases at more than 4,000 Walmart Supercenter stores nationwide. Walmart also integrated Affirm as a payment option on the Walmart.com e-commerce site, and makes the service available in Walmart Vision Centers.
In August 2022, eligible consumers who spent $300 or more on a single purchase with Affirm at Walmart, either in-store or online, received a free 90-day Walmart+ membership. Members of the Walmart+ program, which normally costs $12.95 a month/$98 a year, receive exclusive benefits such as free shipping with no order minimum, free delivery from stores, and discounted gas prices. Walmart has also replaced its layaway program with installment payments from Affirm.
Walmart expands payment options, makes fintech moves
Helping to back the launch of One and partnering with Affirm in the BNPL space are just some of of steps Walmart has taken in the past few years to both become more flexible in how it accepts payment and to establish a presence in the fintech space. In October 2022, the discount giant joined the Premium Payback real-time rewards redemption network offered by fintech provider FIS. As a result, Walmart customers can redeem their credit card rewards points for real-time discounts at more than 4,700 Walmart stores across the U.S.
Walmart has also teamed up with the payments platform and financial technology company PayNearMe to let customers make cash bill payments to utility companies and other billers at select Walmart stores. Other moves include collaborating with InComm Payments to make the payment tech provider’s Vanilla Direct financial network available nationwide at more than 4,700 stores.
Walmart has not publicly commented. Read more coverage from CNBC here.