Walmart, the biggest store in the US, is speeding up its attempts to modernize digital payments by adding pay-by-bank choices and looking into real-time payment networks. The corporation wants to cut down on its use of existing card networks, lower interchange fees, and give customers payment options that are faster and more clear.
At the Smarter Faster Payments conference in New Orleans, Sarah Arnio, Walmart’s head of digital payments, talked about how the firm is dedicated to coming up with new ideas. She said, “We’re really bullish on instant payments and hoping to move forward with them within the next year.”
This project shows how Walmart plans to be competitive in online shopping while also addressing customer needs for speed, openness, and ease of use.
From ACH Transfers to Infrastructure for Real-time Payments
Walmart added a service last year that let users link their bank accounts directly to make purchases using the Automated Clearing House (ACH) network. ACH payments are cheaper than card payments, but they don’t give clients the instant service they want more and more.
Walmart sees ACH as a step toward fully integrated real-time payments (RTP), which are powered by two big U.S. networks:
The Clearing House RTP system started in 2017
The FedNow service from the Federal Reserve (started in 2023)
Both methods promise to settle quickly, but not everyone has adopted them. Larger banks have joined RTP, while smaller and regional banks are more interested in FedNow. Even though more people are signing up, only around 1,300 of the 9,100 institutions in the country have signed up for FedNow.
Customers Want: Visibility, Speed, and Refunds.
A lot of Walmart’s customers use debit cards, and they want to be able to see their account balances and transactions in real time. One of the most common questions customers have about customer service is about refunds.
Real-time payments might automatically reimburse refunds, which would solve one of customers’ biggest worries. Arnio said that this modification could be a “game-changer” for adoption, especially in e-commerce and grocery delivery where speed is very important.
Walmart has also promised to make its operations more efficient by aiming to deliver groceries to 95% of consumers within three hours. Real-time payments help with this goal by speeding up order fulfillment and cutting down on delays in settling.
Things that Make it Hard to use Real-time Payments
Even while people are excited about it, Walmart and other stores have a lot of work to do before real-time payments become common:
Limited Bank Readiness—Many banks can only accept real-time payments right now, not transmit them.
Online shopping Limitations: RTP doesn’t presently enable online retail payments, which makes it hard to connect directly to Walmart’s digital ecosystem.
Process Friction in FedNow: FedNow works with e-commerce, however Walmart says that the user experience still has extra processes that slow down adoption.
Suppliers Don’t Want to Switch – Walmart’s treasury teams and suppliers are still unwilling to switch from ACH since they are used to it and their banking partners aren’t pushing them to do so.
Arnio said, “It’s just not something that’s being pushed from the bank side,” to show how out of touch things are.
Worries about Fraud and an Edge over the Competition
Some organizations still talk about how they don’t believe there is a possibility of fraud. Michael Thomas, who is in charge of rapid payments at U.S. Bank, said that fraud rates in real-time systems have been “really low” so far because there aren’t many ways to exploit them.
Thomas said that corporations shouldn’t be afraid of more fraud; they rather be worried about falling behind as real-time payments become a competitive advantage. He said that over time, these technologies would also be used for transactions between countries, which will open up even more economic potential.
The Retail Payment Landscape: A Turning Point
Walmart’s push for real-time payments is in line with a larger trend in the industry toward quick settlement. Financial institutions have been slow to adopt it, but the trend is quickly picking up speed. Retailers, fintechs, and payment processors all know that skipping around traditional card networks saves time, helps customers, and saves money in the long run.
Arnio said that the momentum is now clear: “We’re definitely at a tipping point where this is only going to grow even more.”
Walmart as a Payment Innovator in the Future
Walmart’s business plan makes it more than just a store; it also makes it a vital player in the adoption of financial technologies. The store is getting ready to change the way customers check out by putting money into pay-by-bank systems, real-time payments, and digital refund solutions. This will also give the store more control over its payment systems.
If Walmart’s plan works, it might change the way people shop in the U.S. and create a new standard for real-time commerce. This would affect both customers and the industry as a whole.