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Table of Contents

Lead Story

Cooperation spurs progress in 2012

News

Industry Update

Experts doubt SAFE WEB Act slows cyber crime

CFPB seeks to refine money transfer rules

Retailers appeal preliminary approval of settlement

Technology spurs cashless adoption

Features

AmEx, Wal-Mart, partner on prepaid debit card

Going postal with financial services

ISOMetrics:
The prognosis for payments - 2013

Selling Prepaid

Prepaid in brief

Blumenthal bill targets gift card fees, expiration dates

First ATM-dispensed, multibrand gift card program in pilot

Views

The confusing state of mobile

Patti Murphy
ProScribes Inc.

Education

Street SmartsSM:
Five predictions for 2013

Jeff Fortney
Clearent LLC

Making sense of 'sensemaking'

Dale S. Laszig
Castles Technology Co. Ltd.

No reservations about mPOS at eateries

Rick Berry
ABC Mobile Pay Inc.

Crunch time for holiday shopping data

Nicholas Cucci
Network Merchants Inc.

Subtle but crucial factors in portfolio sales

Adam Atlas
Attorney at Law

Empower your email

Brian Jones
Harbortouch

Company Profile

American Microloan LLC

New Products

POS with a higher purpose

HioPOS Plus
Regal Payment Systems LLC

More leads in less time

Press 1 Campaign
Live Reps Call Center

Inspiration

Change be with you in 2013

Departments

10 Years ago in The Green Sheet

December 23, 2002 Issue 02:12:02

Forum

Resource Guide

Datebook

Miscellaneous

2013 events calendar

A Bigger Thing

The Green Sheet Online Edition

December 24, 2012  •  Issue 12:12:02

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AmEx, Wal-Mart, partner on prepaid debit card

Editor's Note: This article were first published by InsideMicrofinance.com in November 2012. Reprinted with permission. All rights reserved; 2012 by Patti Murphy.

I didn't see it coming. But then, I may have my head stuck on old stereotypes. I've always thought of American Express as a card for the well-healed, and I've often characterized Wal-Mart Stores Inc. as banker to the working poor.

So the notion of American Express Co. and Wal-Mart teaming on an alternative to traditional bank accounts was beyond my scope of understanding.

But that they did. Last month they took the wraps off Bluebird, a prepaid debit card available at rock-bottom prices and replete with bells and whistles (including the ability to deposit checks using smart phones).

Dan Schulman, Group President for Enterprise Growth at AmEx, described Bluebird as a card for consumers who have been disenfranchised by traditional financial institutions. This is what he said next: "In an era where it is increasingly 'expensive to be poor,' we have worked with Wal-Mart to create a financial services product that rights many of the wrongs that plague the market today."

This sounds a little disingenuous. After all, AmEx is a bank, or more specifically a bank holding company. (That's how the company qualified for a government bailout in 2008.) And Wal-Mart has been trying for years to own a bank, only to be thwarted by lawmakers. Now, together, they want to be banker to America's working poor.

What the card has going for it is virtually no fees: $2.00 for loading cash from a debit card and $2.00 for withdrawing cash from ATMs not in Wal-Mart's MoneyCard network. But I'm betting Bluebird won't stay cheap forever.

After all, back in the mid-1980s, when public consternation abounded over the loss of American jobs to low-wage countries, Wal-Mart made a big deal about selling only goods made in America.

Today the retailing giant's dependence on foreign-sourced products is legend. It was a matter of economics, so the company said, and I'm not convinced that the economics of prepaid debit cards can support the current pricing structure on Bluebird, over time. For now it seems Wal-Mart and AmEx will seek to profit from interchange - the discount merchants take for accepting card payments.

One potential problem: many merchants don't accept AmEx cards because they cost much more to accept than do MasterCard Worldwide and Visa Inc. cards. I also question whether the unbanked are so status conscious that they'll take an AmEx-branded reloadable prepaid card product over a Visa- or MasterCard-branded product. Time will tell.

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

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