Bentonville, Ark. Wal-Mart Stores said that it plans a 50% increase in 2010 of the number of stores that offer financial services. According to a late Monday report by wsj.com, the addition of 500 Wal-Mart Money Centers this year will increase the number of in-store centers to 1,500.
Wal-Mart said it plans to open its 1,000th money center Tuesday.
The money centers cater to millions of the retailer's lower-income customers who don't have a bank account or significant relationships with a bank. The federal government estimates that the category accounts for one in four U.S. households.
"We think banks are not as interested in this customer and have a lot of other things on their plates," Jane Thompson, president of Wal-Mart Financial Services, told the Wall Street Journal. "So we see a lot of ... space to service customers' basic financial needs."
Thompson described the money centers, which do three million to five million transactions a week, as "a very profitable part of our store." She said the centers are "getting way-above-average" comparable-unit growth and return on investment, because the units are cheap to put into stores.
Wal-Mart can't lend money and back deposits with a government guarantee, but the retailer has no plans to continue its years-long quest to receive a requisite bank charter in the United States.
Wal-Mart does have a banking charter for its stores in Mexico and is seeking approval for a banking charter for its Canadian stores.
The retailer works in the United States with General Electric Co.'s banking unit, which issues the Wal-Mart debit card. Green Dot Corp. processes customers' debit transactions.
Wal-Mart began setting up the money centers in 2004, reaching the 1,000 mark over the next six years. The 500 coming this year are the result of remodeling that Wal-Mart is doing to many of its stores, space that has opened up, and demand, Thompson said.
Wal-Mart said it plans to introduce additional money centers beyond this year.