What will Walmart’s launch of BNPL through One mean for the industry?

Walmart announced in April that it will be leveraging its majority-owned fintech One to offer BNPL options to its customers. This move is an addition to a growing list of retailers who are expanding into financial services like Apple and Amazon.

In 2022, Walmart’s One started offering some banking services to its own employees and some customers under the tutelage of new hires of Goldman Sachs’ Omer Ismail and David Stark. Before its launch of BNPL through One, Walmart partnered with Affirm to offer pay in four options to its customers. But now BNPL offerings by both One and Affirm compete for consumers’ attention in Walmart stores.

As retailers like Walmart move deeper into financial services, how will their presence impact dedicated fintechs like Affirm and Klarna as well as the industry as a whole.

Impact on fintech competitors

Tearsheet research found that 55% of executives in the financial services industry view retail brands as the most significant threat to traditional FIs long term. While Affirm is already competing for wallets in Walmart stores, the entry of a retail brand that owns 8% of the market share in the industry could compel dedicated fintechs to offer more “attractive or creative financing options to both customers and other retailers to maintain market share,” according to Peter Galvin, Chief Growth Officer of NMI, a payments technology provider.

This move may also allow Walmart to deepen its relationship with its customers, who already have access to financial services like debit rewards, early access to pay, and a high-yield savings option through One. “This strategic move not only bolsters Walmart’s competitive edge but also creates a deeper 

connection, enhanced engagement, and personalization for consumers who opt for buy now, pay later (BNPL) options,” said Galvin. _____________________________________________________________________