Another Mega Tech Company Enters The Banking Realm

in LeoFinance2 years ago

The banks are done.

About a month ago, I wrote an article basically making that same statement. Some took exception to it believing that the major banks were not going anywhere.

Yet, here we are a month later and we see another major technology company entering the space.

Who is it you ask?

The company is none other than Walmart.

Walmart a technology company? Exactly.


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Over the last year, I made the case on a number of different occasions how Walmart is now on the mega technology companies out there. With some of the highest revenues in the land, this is a force to be reckoned with.

Most still view it as a retailer but that is a mistake. Walmart is every bit as aggressive with technology as Amazon is. Sure, the later has a head start yet the mega-retailer is catching up quickly.

Remember Walmart's interest in TikTok? Why did this company have an interest in a mobile application? The reason is because of the mobile payment system it has.

This is a company that is also investing heavily in AI and robotics. The point that I always stress is how long until, instead of buying the AI or the robots, they buy the entire company?

Now we see another avenue they are pursuing.

FinTech did quite a number of the banking industry over the last 15 years. Stalwarts of that industry were taken away by financial innovators from the tech space. In the United States today, more than half the loans originate outside the banking industry. Quicken is the largest originator of loans, not Bank of America or Chase.

Walmart is ready to get involved itself. Here is what was said about the announcement:

Mega-retailer Walmart has founded a financial services-focused fintech startup alongside Ribbit Capital, an investor of fintech firms, according to a Monday announcement.

The as-yet-unnamed startup will be centered around "modern, innovative and affordable financial solutions," according to a press statement.

So far, so good. Just typical "this is what we plan to do" stuff. We know starting anything from scratch is always a challenge. Nevertheless, with Walmart's existing customer base, it might be able to make a go of it.

It is of great help that their partner already raised $1.3 billion across 11 funds. Expect the partnership with Walmart to seek to go that number significantly.

However, there is something that was even more telling.

Walmart's press statement pointed to a future of acquiring other services, indicating that "growth may come through partnerships and acquisitions with leading fintech companies."

Here is where much of the rub comes in. Walmart, which is basically a cash machine, is going to use those funds to acquire leading fintech companies. If writing out a check is all it takes to grow those numbers, it is a given. Acquisitions Walmart can do in droves if they want.

What is interesting is that crypto is also getting some attention.

How cryptocurrencies or blockchain technology might potentially fit into the mixture remains to be seen. As previously reported, Walmart has sought patents related to use cases in the digital currency arena, including one that outlines a kind of USD-pegged stablecoin. Walmart has also taken part in pilot programs involving the use of blockchain for product tracing.

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A Walmart stablecoin? Talk about a game changer in the United States. Can you imagine the impact of a Walmart stablecoin on the market?

Certainly this is all speculation at this point since the details and plans are not revealed at this point. However, the main emphasis is that one of the largest companies in the United States, by revenue, is now getting heavily involved in the FinTech arena.

As I said a month ago, this does not bode well for banks. Ultimately, there are very few aspects of finance that Walmart could not get involved in if it desired.

Those of us who are around crypto for a number of years always felt that crypto would, eventually, do in the banks. It now appears that crypto coupled with a major corporation like Walmart is going to put a serious hurt on them.

We will see what Walmart unveils but I would expect it not to make the bankers feel warm and fuzzy.

I also have a feeling the Walmart application is going to enable users to do a lot more than just shop for different items.

Times are changing very rapidly.


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I think the banks are lagging behind other companies in Cryptocurrency.
I think it is not good for financial services providers to have no leadership in the evolution of money.

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@taskmaster4450le, Money Makers know when to jump and where to jump. Feels like Blockchain and Tokenization will evolve into everything. Stay blessed.

I believe in the potential of Walmart. I guess it is one of the top fortune 500 companies if I'm not wrong and it gave tough competition to Amazon. They even acquired the top online retailer company in India called Flipkart and it is now giving even more tough competition to Amazon in India. I'm not sure what would be their roadmap but hoping to see a good future for this company.

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Yes in the retail world they are very powerful. However, they are more than just a retailer. This article shows they want to be a player in the financial world also.

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Those of us who are around crypto for a number of years always felt that crypto would, eventually, do in the banks. It now appears that crypto coupled with a major corporation like Walmart is going to put a serious hurt on them.

We will see what Walmart unveils but I would expect it not to make the bankers feel warm and fuzzy.

It was just about time to move things forward. It's enough for one giant to join and lead the way, the others will follow. I remember your other post about Walmart investing in AI and robotics. This is all good news and the proof that it's time for change.

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This is all good news and the proof that it's time for change.

I am not sure it is good new, it is news though.

We are just swapping one major type entity, the banks, for another, Walmart (and others). Going into the hands of major corporations is never a good thing.

It certainly appears to be bad news for the banks.

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Oh man, I hate Walmart. The only thing good about going into a Walmart is getting some of their boneless wings. Beyond that I try to avoid the store like the plague. There is no doubt they are the biggest retailer in the United States, so they are obviously doing something right. I have to believe that they have a very specific and organized plan for moving forward into this sector. It doesn't feel like something they would do haphazardly. They definitely have the reach to make this successful. Now they just need to team up with Dollar General. Those things are popping up everywhere too!

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whoa

things are moving quick

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They certainly are. Not sure the world is any better with Walmart in control of the financial system as opposed to Goldman Sachs.

Nevertheless, it is another attack on the banks. In the meantime, crypto just needs to keep getting stronger.

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Any decentralization is good for everyone and creates competition that never existed. The banks haven't had to deal with this for generations. It will be a problem if Big Tech manages to corner the market, but obviously people like you and me think Big Tech will then get undercut by the people and fully open-source protocol. One can hope.

I coin made and controlled by a corporation doesn't sound too great in my opinion. It smell's like facebook's libra.

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Traditional banking has had several years to start adapting to new technologies and offering interesting and attractive services as fintech can do.

If I'm not mistaken the first big financial payment revolution was introduced by Paypal (at least in terms of mass adoption it certainly was) and now we are having the cryptocurrency revolution.

However, the bank never tries to adapt to the reality of paypal, focusing solely on continuing to do what they did thinking that this would be enough for them to continue to exist but now they must have realized that with the new generations they they are many light years away and losing their presence.
These new generations are using more modern solutions like Revolut, N26, among others.

Either the bank adapts very quickly (making up for lost time) or they ended up disappearing over time (at least as we know it today).

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No one can ignore the future for long, can they?

It is so good to see this all happening. Now, it's that moment when can say "I told you so?", haha!

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I agree.
I watched Walmart try to be a bank, get shot down, then it invented its own in-store financial services system, which became the bank for millions of Jn-banked. Now they don’t need banks, they can do DeFi with a Walmart Coin. What they don’t know they can buy, and people don’t hate them like Facebook.
I think your spot on...something big is down the road.

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