JOIN USWal-Mart is offering another incentive to its customers to spend more time at its stores. The world's largest retailer introduced a new money transfer service today that it says will cut fees by up to 50 per cent compared with similar services elsewhere.
The Walmart-2-Walmart service is being rolled out in partnership with Ria Money Transfer, a subsidiary of Euronet Worldwide Inc.
Shares of MoneyGram and Western Union plunged almost immediately on Friday after the announcement.
The service, which will be available starting April 24, allows its customers to transfer up to $900 to and from more than 4,000 Wal-Mart stores in the US.
It's a huge footprint that could reshape that industry and is likely to set off a pricing battle.
Customers can transfer up to $50 for a $4.50 service fee and up to $900 for $9.50.
Comparable services elsewhere cost up to $70 when transferring less than $1,000, according to Wal-Mart.
Western Union on its website puts the price of transferring $900 in New York between $20, if using a bank account, to $85 if using a credit or debit card.
Wal-Mart is creating an expanding menu of financial offerings for customers, particularly for those with limited exposure to banks. Wal-Mart already offers prepaid debit cards and tax preparation services.
MoneyGram is the company that currently provides money transfers to Wal-Mart. The company could not be reached immediately for comment. But in a statement emailed to The Associated Press, Western Union said, "Our retail product and service offerings today are already quite diverse."
It noted that people have the flexibility to send money in minutes or next day from a retail agent location or online and they can also send money directly into a bank account.
"The company is well positioned in the US domestic money transfer space, having offered a fee of $5 for $50 since 2009," it added.
Wal-Mart is aggressively trying to increase foot traffic in its stores after seeing comparable-store sales decline for four consecutive quarters.
The Walmart-2-Walmart service may help stem that trend, giving customers just one more reason to spend more time inside Wal-Mart.