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Walmart extends financial services with money transfer operation

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Walmart like Amazon is moving itself further into traditional financial services provider territory, by expanding its money transfer operation to 200 countries

Walmart extends money transfer operation Walmart2world

Walmart extends financial services with money transfer operation

Through the new money transfer operation, people will be able to deliver money from Walmart’s nearly 5,000 US stores to locations abroad within 10 minutes.

As more consumers increasingly rely on Walmart and Amazon for their daily shopping, tie-ins to their finances are another way to keep customers on the companies’ websites and visiting their stores. Walmart first unveiled a money transfer service four years ago, allowing customers to send funds between its stores, and aiming to reach the “underbanked” — about 27% of Americans have limited access to traditional banking, according to the Federal Deposit Insurance Corporation.

Walmart claims it has saved customers $700m in fees because it charges cheaper rates.  The retailer has partnered with MoneyGram, one of the big wire transfer groups, to expand globally this month. The service will allow US residents to send money to countries such as Mexico, which received nearly $30bn in remittances last year, according to Mexico’s central bank.

Customers will pay $4 to send up to $50, $8 to send up to $1,000, and $16 to send up to $2,500. Money can be delivered to MoneyGram’s agent locations in 200 countries, or an international bank or mobile wallet account.  Walmart’s push into money transfers comes a few months after it announced it was partnering with PayActiv and Even, two financial-technology firms, to offer its 1.4m US employees tools for money management and on-demand access to their earned wages.

The moves suggest the retailer may see itself as a partner of the big financial services companies rather than a direct rival going head to head with basic products such as checking accounts or credit cards. Amazon, too, may be on a similar path: it is discussing a potential partnership to offer its customers bank accounts via JPMorgan Chase, in a deal that could unite the US’s biggest e-commerce platform with the country’s biggest bank.

posted Apr 5, 2018 by Sanjay Rawat

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Walmart and MoneyGram International are coming together on a new international money transfer service called Walmart2World that will debut later this month at the retailer's U.S. locations, according to a press release. 

"We think sending money should cost the same regardless of where you send it; that's why we've designed a brand new global wire service to send money to 200 countries with a consistently low fee," Kirsty Ward, vice president of Walmart Services, said in a release. "There are millions of people sending money around the world to help loved ones with everyday needs or in times of emergency. Walmart2World, Powered by Moneygram helps customers get money to family and friends across the world in minutes, and the new low fees mean more of their hard-earned cash goes where it’s needed most."

Walmart said the service will have three unique aspects that are intended to make it different from competitors:

  • Unique pricing structure: Fees will remain the same no matter where the money is being sent from in the U.S.: $4 to send up to $50, $8 to send $51 to $1,000, and $16 to send $1,001 to $2,500. Walmart claims this is unlike other international transfer services that change the fee to transfer money based on where sender and/or receiver are located.
  • Highly competitive exchange rates: Walmart said it is committed to ensuring customers receive a more competitive foreign exchange rate when transferring money using Walmart2World. The new Walmart2World low fees, combined with these great exchange rates deliver incredible value for international sends.
  • Delivery within minutes to worldwide network: Walmart2World will deliver funds in 10 minutes or less, whether the receiver opts to pick up the money at any one of MoneyGram's agent locations in 200 countries, or an international bank or mobile wallet account.
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After the disappointment of US regulators blocking its purchase of MoneyGram, Ant Financial has taken a step towards dramatically lowering the cost of remitting money overseas in a move that will, in its initial stages, help the hundreds of thousands of Filipinos working in Hong Kong, who collectively remit about HK$4.4 billion ($561 million) annually to family and friends back home.

By using blockchain technology, Ant Financial aims to eventually cut the cost of remittances to near zero, according to Alibaba co-founder Jack Ma Yun, who said he wanted to find a way to help people.

“This comes from a promise I made a long time ago when Alipay was just launched,” said Ma. “I have Filipino friends who asked me when they could use Alipay to send money home because it was too expensive through banks, which charge too much.”

The blockchain money remittance service announced Monday for its AlipayHK wallet is the first of its kind globally, according to Ant Financial. It is currently available only for transfers between Hong Kong and the Philippines, which is the world’s third-largest remittance market, with inflows of $33 billion in 2017, according to Standard Chartered, which will act as the settlement bank for both AlipayHK and GCash for the blockchain transactions.

“Hong Kong is an international financial centre in Asia, and it is most fitting that Ant Financial has chosen to kick off this pilot project right here,” said the city’s financial secretary Paul Chan Mo-po. “We take pride in Hong Kong’s robust and effective financial regulatory regime that is in line with international standards. Our financial regulators are doing their part to facilitate and foster innovations in the industry with their dedicated liaison platforms and sandboxes … allowing financial service providers to conduct pilot trials of fintech solutions in confined environments.”

Hong Kong’s banks and remittance outlets charge about HKD$18, and may impose other costs such as commissions or currency conversion fees on every transfer.

Ma, speaking at the launch event, said he wants to make it possible for people to remit even 1 cent at almost no cost, compared with the higher fees charged by traditional remittance services like MoneyGram, which Ant tried to buy last year.

“At the time we wanted to buy MoneyGram and overhaul it to help people all over the world solve this issue. Due to reasons from the US our deal with MoneyGram did not succeed, so I said, ‘Let’s make one better [than MoneyGram]’ that uses the most advanced technology,” Ma said.

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IBM stated Thursday (9th March 2018) that it has over 400 client projects on its blockchain platform.

Among its biggest clients are companies were like Walmart and Nestlé. It also disclosed a list of banks and trade companies using its blockchain.

Blockchain technology is often associated with cryptocurrencies like bitcoin, but enterprises are taking it on as a new tool for trade and payments.

IBM's foray into blockchain technology is catching on with customers, according to an investor briefing shared by the company on Thursday. At least 63 IBM customers are now running over 400 blockchain-based projects, according to the briefing. Among those customers: 25 companies in global trade, 14 companies in food tracking, and 14 companies in global payments. Some of IBM's most recognizable blockchain clients include Nestlé, Visa, Walmart, and HSBC.

While blockchains continue to be widely associated with startups and cryptomillionaires, IBM's client list shows that large enterprises are truly embracing the technology. IBM and Walmart actually launched a joint food safety blockchain project globally last year, which enables the grocery chain to figure out where specific produce originated in a matter of seconds.

But IBM's product, which is built on top of an open-source blockchain called HYPERLEDGER FABRIC, uses "permissioned networks." This means companies can have some of the information on their bespoke blockchain be publicly viewable, and some of it locked behind a password or other security mechanism.

A global trader like the Dow Chemical Company (an IBM blockchain user) may want to have an immutable receipt between itself and its trade partners in order to guarantee that no one is being scammed. But it doesn't necessarily want that information to be viewable by its competitors - or, say, the media.

In global shipping, IBM's clients include Maersk, Du Pont and Dow Chemical. Its food trust customers include Walmart, Nestlé, Kroger and Unilever. Its global payment customers include Visa, the Polynesian payments company KlickEx, EarthPort, Nab,, BBVA and CIBC. And in trade finance, IBM's customers include Societe General, WeTrade, HSBC, Unicredit, and Santander.

They're not the only ones rushing towards the blockchain, either., the Amazon of China, is launching a project to put high end beef improts on a blockchain so that its customers can see where their meat has been.

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The UIDAI revoked on Tuesday their access to a dozen agencies that provide  e-KYC verification and authentication services. Some of the agencies - KUA (e-KYC user agencies) and AUAs ( authorized user-agencies) - Will no longer be able to provide e-KYC verification to onboard new customers or authenticate financial transactions affecting e-Wallets, Online lenders, Capital lenders and NFBCs and smaller Fintech players.

Many Fin-tech players are not AUAs or KUAs themselves but sub KUAs and sub AUAs routing their requests through UIDAI's network. The recent development will affect these companies, particularly e-commerce players and peer to peer lending platforms, which operate on a completely online model.They will now have to change their mode of doing business and incur higher costs to physical verify the credentials of their customers.

This is detrimental to Fintech companies which relay on e-KYC for user verification and on-boarding.A physical KYC costs about rs 100 per person, while the same is roughly rupees 15 when done via e-KYC.

Some service providers like PAyU on an average onboard about 40000-50000 users everyday and conducting physical kyc for them would be costly affair. The move doesn't affect the banks, insurance companies or mutual fund houses as many of them are AUAs or Sub AUAs with UIDAI. Even players like payment banks Paytm , Airtel and JIO were unaffected as is the case with some e-wallets like Mobiqwick. 

UIDAI officials said they are yet to understand the situation and ascertain approvals that might have been revoked after a CERT in empanelment IT security audit. An earlier security audit in sept 2017 saw UIDAI black listing 49000 enrollment centers. UIDAI however says that It is an exaggeration to say access has been revoked to all KUAs , some KUAs might have been barred post audit for various reasons like lack of compliance, technical lethargy etc. For some players like who do not fill the criteria their access was revoked much earlier. 

An official at a private bank said UIDAIs actions are based on report that they were storing customers data on their devices and attempting to create parallel database by industry wide collobration on the dark web

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Financial Services Agency is said to carry out inspections on cryptocurrency exchanges this week.

A source close to the investigation told Reuters the inspection may expand its enquiry. Several operators will be subject to on-site inspection. The probe will take place based on conditions such as degree of vulnerability to cyber threats.

There are enough concerns for regulators whether exchanges are looking into the practice of separating customer funds and operating accounts as required.  

Director-General of payment and settlements, Hiromi Yamaoka, said, “There’s undoubtedly growing interest among global policymakers on how to deal with cryptocurrencies. Japan’s approach would be to think about how to curb excesses without discouraging innovation.

“So far, I don’t think there are any big problems. But we need to look carefully. If the exposures turn out to be huge, we may need to follow up and work to maintain financial stability together with the Financial Services Agency.”