Walmart Inc. (NYSE:WMT) has inked a strategic partnership with investment firm Ribbit Capital. The two are coming together to create a new fintech startup that will focus on modern innovative, and affordable financial solutions.
Walmart-Ribbit Partnership
Under the terms of the agreement, Walmart will own a majority of the fintech startup. The fintech startup board members will include Walmart CEO John Summer, Brett Briggs, the executive vice president, and Mayer Malka Ribbit Capital managing partner. In addition, they plan to add independent industry experts as part of the management team.
The strategic partnership will result in the merging of the big box retail knowledge and scale with the fintech expertise in delivering tech-driven financial solutions. The two are yet to share a name for the new company or when its services will be made available. In a statement, Walmart says it will continue to serve customers through existing financial services and partnerships.
Walmart and Ribbit intend to develop unique and affordable financial products with the fintech startup. Walmart customers and employees will use their products. The big-box says it is using the opportunity to leverage the years that millions of customers have put trust in its solutions.
Walmart Financial Solutions
Walmart boasts of a huge customer base thanks to its 4,700 stores spread across the country. Likewise, it maintains interaction with customers, some of whom don’t have an interaction with banks. It is expected that the products that come out of the joint venture will go a long way in addressing such customers' needs.
The fact that s6% of adults in the U.S don’t have checking, savings, or money account presents a massive market that Walmart and Ribbit will be able to address with their products. Walmart already offers financial services through its Money Card that lets customers load with money for purchases.
Ribbit is a perfect partner as Walmart seeks to enhance its financial solutions as the fintech company boasts of the tremendous history of investing in fintech companies. Its portfolio includes the likes of Robinhood and Credit Karma.