Walmart American Express card offers serious challenge to banks

Cards

The new Walmart American Express card, dubbed Bluebird, is one of the best buys there are for prepaid debit cards, as it offers a host of functions at a very low cost. Photo Credit: Andres Rueda/Flickr.com/CC-BY

Walmart is said to always be rolling back prices and the people of Walmart now have something else they can get for cheap from Wally World, namely a bank account. Bluebird, the Walmart American Express card, could offer a serious challenge to banks as the prepaid card has a lot to offer.

Prepaid Walmart American Express card out to almost bank the unbanked

A number of prepaid debit cards are available at Walmart and other retailers, but a new one, called Bluebird, could offer some people a somewhat serious alternative to having a bank account. Bluebird is a joint venture between Walmart and American Express, one of a number of prepaid cards being offered by major players in financial services.

As a result, the Walmart American Express card offers a bit more functions than a typical prepaid card does. According to Bloomberg, among other functions customers can get direct deposits, automatic bill pay and even remotely deposit checks by snagging a picture and transmitting it via a smartphone application.

There isn’t a minimum balance requirement and there aren’t any monthly or annual fees and costs only $5 to purchase.

Meets many needs

The Walmart American Express card, just like other prepaid debit cards, are great for people that need bank or bank-like services but can’t afford the fees charged by a traditional bank. Prepaid debit cards technically are bank accounts, since the account tied to the card is hosted by a bank, in this case one of American Express banks.

There is a $2 ATM withdrawal fee, according to Forbes, even if a withdrawal is made from one of the 22,000 ATMs in the AmEx network. However, those fees are waived if the cardholder uses direct deposit.

The card, according to the Washington Post, does come with some measure of fraud protection. AmEx also doesn’t check credit scores of Bluebird card holders. The card can be loaded with cash at any participating Walmart or other locations, but according to American Express’ website, that can involve a third-party fee.

There aren’t any fees for direct deposits or bank transfers to the card. Some online banking functions are also available through American Express’ website.

Attractive alternative

The beauty parlor about the Walmart American Express card is that it basically offers all the functions of a checking account with a debit card without the fees. It also is cheaper to get than another very popular Walmart debit card, Green Dot, comes with a $3 monthly fee. Bluebird doesn’t.

There are some drawbacks, of course. It isn’t a checking account in the traditional sense, as one can’t write checks from the account. The card also does not, according to Forbes, enjoy protection from the Federal Deposit Insurance Corporation. For those who want all the functions of a bank account without the fees or hassle of needing to go to bank, it definitely is an attractive alternative.

Sources

Bloomberg

Forbes

Washington Post

American Express: https://www.americanexpress.com/us/content/prepaid/american-express-prepaid-card/home.html?vgnextchannel=95ddb81e8482a110VgnVCM100000defaad94RCRD&appInstanceName=default&name=gpr_home&type=intbenefitdetail

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