Walmart-backed fintech startup plans BNPL

A Walmart-backed firm intends to go up against the buy now, pay later businesses.

According to a source with knowledge of the situation, the company, known as One, is preparing to introduce its own version of the payment service as early as next year.

The source stated that One, which is primarily owned by Walmart, plans to introduce a service that customers will be able to use at both Walmart’s internet and physical shops as well as other merchants.

Buy now, pay later company’s shares On Friday, affirm decreased. Walmart opted not to respond.

One is expanding into the expanding payment services market as monthly retail sales numbers rise, but some Americans are beginning to feel the pain of inflation as the cost of food, housing, and other commodities rises. Consumers’ interest in making alternative payment arrangements may increase as a result of their tight wallets. Customers who choose the buy now, pay later option can progressively pay off a product with predetermined monthly instalments plus interest.

Retail CEOs have discussed how even wealthy shoppers are feeling squeezed by inflation, including Walmart CEO Doug McMillon. In the previous two quarters, families with incomes over $100,000 accounted for over 75% of the retailer’s market share growth in the food category.

Customers are stressed, according to McMillon in an interview from this week.

He said that some of his more cost-conscious clients have been feeling the effects of inflation for several months. “I believe that as Christmas approaches, customers are having to deal with that sustained pressure in some areas.”

The Information was the first to break the news about the Walmart-backed startup’s interest in buy now, pay later.

Walmart, the biggest retailer and private employer in the nation, has long provided banking services at many of its locations. For banking-related services including printing checks, sending or receiving money, or loading prepaid debit cards, consumers can travel to the facility’s money centre. Many of those services are designed for families with lower incomes, who don’t bank with traditional institutions, or who lack the credit histories needed to be approved for credit cards.

By establishing and funding a fintech business alongside Ribbit Capital, one of the investment firms responsible for Robinhood, Walmart took things a step further last year. Despite being autonomous, Walmart holds the largest share in the finance business. The CEO of Walmart in the United States, John Furner, and the chief financial officer, John David Rainey, are both members of its board. Former PayPal CFO Rainey recently joined the board and is now Walmart’s CFO.

The firm has grown since Walmart founded it and provided funding for it in the beginning of 2021. Early this year, it paid an unknown sum to buy One and Even, two additional fintech businesses. With the goal of being an all-in-one app where users can manage their money, it took on the name One.

Omer Ismail, who oversaw Goldman Sachs’ consumer bank, is in charge of one. Other former Goldman employees are also a part of it.

Buy now, pay later has grown increasingly congested as additional businesses enter the market with their own versions, including Affirm, PayPal, Klarna, and AfterPay. Apple Pay Later, the company’s own buy-now, pay-later option, will also soon be available.

Through Affirm, Walmart already gives customers the option to purchase now and pay later. Prior to the previous holiday season, it discontinued its layaway programme and switched to a financing option called “buy now, pay later.”