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Wal-Mart, Your Soon-To-Be Neighborhood Bank

In New York City, US Politics on June 7, 2006 at 2:29 pm

Wal-Mart and Home Depot continue their efforts to obtain “industrial loan bank” charters. These charters supposedly limit what a bank can legally do as compared to a full-service traditional bank — Wal-Mart, for example, claims it is only applying for this charter in order to process credit and debit card transactions in-house, instead of paying another company to do it — but if this is anything like Wal-Mart’s “limited” entry into the grocery store business which has exacerbated a dual system of food access in the States (poor shop at Wal-Mart & Costco, the rich at Whole Foods with fewer options in between), community banks are rightfully up in arms. Wal-Mart’s 2005 entry into liquor distribution has already and will continue to have the same market squeezing impact on the little distributors. There will be more on all this later, as Wal-Mart is almost certainly going to expand beyond credit card transactions into check cashing, then into offering checking/savings accounts for employees, and on and on…

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  1. […] The Bank Lawyers Blog discusses the continuing turf battle between federal regulators around Wal-Mart’s proposal to charter a bank (an “Industrial Loan Corporation”) in Utah.  We have a primer on the application here. […]

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