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Walmart's effort to get customers to build up their savings accounts

theatlantic.com

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Re: Walmart's effort to get customers to build up their savings accounts

#51

Post by bpodgursky »

fefesafaea wrote: post #48
bpodgursky wrote: post #38

Earlier quoted context omitted.

Um, no, you completely made up the numbers, making no attempt to source from the article which laid them out clearly. It's not the same "ballpark". - It's $1 for the card, not "$5-$10" - It's free cash withdrawal, not $3 - It's free deposits from direct deposit or government benefits, not $3 You are not approaching this remotely honestly.

https://www.walmartmoneycard.com/account/legal-info-page?pro... As I said, there are a variety of cards on offer, from a variety of sources, but they all seem to fall within the same range cost-wise, even if the fees are structured differently. It's as if we are arguing about cars, and you want to debate whether the pinto in question had power-windows or not, while ignoring the fact that it will explode in a routine…

Dude, you really need to think carefully about whether you are approaching this topic honestly, or if you are hunting for reasons to reinforce your belief that this card is a scam.

The precise things you claimed about this card are _not true_. Those are facts. If you want to debate, use _facts_.

Nobody is denying that WalMart _could_, if they wanted to, offer a savings card which is a scam. But also consider their motives going into this, compared to the average bank:

- Wal-Mart's goal is to get people to spend money at Wal Mart. This card makes it easy to spend money at Wal-Mart.

- Banks exist entirely from interest on saved money, and on fees.

Since these customers have very little saved money (the whole point of this article), the money made is entirely from fees, unless you have another reason to get people to use the card. Wal-Mart does -- it is totally reasonable for them to run this program at-cost to attract customers. You cannot say the same for any bank.

If you want to disagree with the merits of people spending money at Wal-Mart, that's a different topic. But the evidence points to this card being a good deal for an underserved part of the population.

Re: Walmart's effort to get customers to build up their savings accounts

#52

Post by rdl »

flukus wrote: post #46
protomyth wrote: post #30

Earlier quoted context omitted.

They cannot get a bank account to get a debit card. Banks and a lot of credit unions have become problematic for low income folks.

Why is it hard to get a bank account? There is no risk to the bank from a low income person having an account, worst case for them is it's empty.

There is risk to the bank for bad-credit people having an account.

1) CSR interactions cost them way more than they'll ever make from the account, if the person stays poor forever

2) A lot of banking actions are not proper "transactions" or atomic in the CS sense -- you can end up overdrawing an account pretty easily. A genuinely poor person is eventually going to get charged off on this.

A lot of poor people fail chexsystems (bank account credit check, basically) from bounced checks, and thus can't open accounts. Which then limits their access to the banking system, including receiving funds, forcing them to use more expensive alternatives.

Re: Walmart's effort to get customers to build up their savings accounts

#53

Post by toomuchtodo »

flukus wrote: post #45
sigstoat wrote: post #32

Earlier quoted context omitted.

you can overdraft debit cards, and of the college students i've known over the years, that's the most common thing to overdraft. and then find out about your overdraft (and the 17 following it) a week later when you get a letter in the mail.

> you can overdraft debit cards Not always, my debit cards have always had the overdraft facility turned off. If there's no money in the account then the transaction doesn't go through.

Unsure why this is so downvoted? Several banks support turning off the overdraft feature, which just causes debit transactions to be declined (or ACH items returned).

Re: Walmart's effort to get customers to build up their savings accounts

#54

Post by protomyth »

flukus wrote: post #46
protomyth wrote: post #30

Earlier quoted context omitted.

They cannot get a bank account to get a debit card. Banks and a lot of credit unions have become problematic for low income folks.

Why is it hard to get a bank account? There is no risk to the bank from a low income person having an account, worst case for them is it's empty.

https://mobile.nytimes.com/blogs/dealbook/2013/07/30/over-a-...

Re: Walmart's effort to get customers to build up their savings accounts

#55

Post by morgante »

bpodgursky wrote: post #24
fefesafaea wrote: post #13

Kind of fucked up that the article doesn't mention the fees associated with these cards until like 3/4 of the way into the article. These cards charge 5 bucks a month, plus like 3 dollars to deposit cash, 3 dollars to withdraw cash, in addition to the 5-10 dollars up front for the card itself. Because of this, a person using this type of card can easily spend $100+ a year on fees. Not exactly a great way to save mone…

Just read the article. It's $1 for the card and free cash withdrawal at a Wal-Mart banking center. It is $5/mo for accounts with less than $1000, but you're not going to get better than that at a bank. More importantly, they aren't pulling the overdraft scams that banks are. The example right here is that the customer in question pulled $100 in overdraft fees over a $4 purchase, with a traditional bank card.

> It is $5/mo for accounts with less than $1000, but you're not going to get better than that at a bank.

Sure you are. I have many accounts with less than that. Don't spread FUD.

Overdraft fees are easy to avoid if you just tell them to decline overdrafts.

Re: Walmart's effort to get customers to build up their savings accounts

#56

Post by rdl »

flukus wrote: post #45
sigstoat wrote: post #32

Earlier quoted context omitted.

you can overdraft debit cards, and of the college students i've known over the years, that's the most common thing to overdraft. and then find out about your overdraft (and the 17 following it) a week later when you get a letter in the mail.

> you can overdraft debit cards Not always, my debit cards have always had the overdraft facility turned off. If there's no money in the account then the transaction doesn't go through.

It's possible to overdraft a debit card even if overdraft is not enabled on the account, due to how some merchants process some transactions.

Re: Walmart's effort to get customers to build up their savings accounts

#57

Post by morgante »

protomyth wrote: post #28
oconnore wrote: post #6

Earlier quoted context omitted.

Capital One 360 pays 0.20/0.75 APY (checking/savings respectively) with no fees or minimums (I'm sure others do too, I just happen to be a customer ^). So... they are not benefiting. They are losing out on interest and a real bank account, and Walmart is seducing them to stay with a lottery.

Capital One 360 is for people with better credit than the folks in the article have. If you have means then you get better investments. Heck, a lot of the people in the article are rejected just trying to open a bank account. AmEx allow direct deposit to their Bluebird card which is another Walmart card.

> Capital One 360 is for people with better credit than the folks in the article have.

They don't pull your credit to open an account, so I don't see how that's true. I've had one since I was 18 (and had no credit history to speak of).

Re: Walmart's effort to get customers to build up their savings accounts

#58

Post by twblalock »

toomuchtodo wrote: post #53
flukus wrote: post #45

Earlier quoted context omitted.

> you can overdraft debit cards Not always, my debit cards have always had the overdraft facility turned off. If there's no money in the account then the transaction doesn't go through.

Unsure why this is so downvoted? Several banks support turning off the overdraft feature, which just causes debit transactions to be declined (or ACH items returned).

The problem is that those features don't always work if multiple pending transactions have been submitted, or if checks are used, transactions ordered a certain way (some banks have been in trouble for doing this in the past), etc.

Re: Walmart's effort to get customers to build up their savings accounts

#59

Post by [deleted] »

ricardonunez wrote: post #39
asafira wrote: post #33

Earlier quoted context omitted.

What do you mean by "It is $5/mo for accounts with less than $1000, but you're not going to get better than that at a bank."? Aren't there lots of banks that charge nothing even if you only have <$1000?

A lot of banks got rid of their free or low cost checking accounts. Hard to find anything less than $12 per month when the balance is below $1500.

[deleted]

Re: Walmart's effort to get customers to build up their savings accounts

#60

Post by morgante »

wtvanhest wrote: post #41
RhysU wrote: post #31

> living paycheck to paycheck is now a commonplace middle-class experience The article states this as fact. Seems wholly bogus, but perhaps I define middle class weirdly. I think of it as robust stability moreso than income earned. Anyone know a plausible source for the assertion?

The middle class in America average about $50k in household income ($25k each). Regardless of income, by definition, the middle class should always average out to basically break even unless we are in periods of rapid growth. This should happen because their willingness to pay for food and shelter is determined by what they make and eventually prices will catch up to income if income doesnt grow. I imagine the concep…

That's under the assumption that people don't want to save any money.
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