MONEY Banking

Use These Tools to Find the Best Banks and Credit Cards for You

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Answer a few simple questions, and we'll help you find a bank that will earn you more and a credit card that will cost you less.

Which bank has the most branches in your neighborhood and the lowest ATM Fees? Which credit card is best to take on your international travels? Check out MONEY’s annual rankings of the Best Banks and Best Credit Cards, and use our new Bank Account Matchmaker and Credit Card Matchmaker tools to find the accounts and plastic that are right for you.

Click here for the Bank Account Matchmaker

Click here for the Credit Card Matchmaker

 

TIME Money

European Commission Fines Banking Cartel $120 Million

US-FINANCE-JP MORGAN-MADOFF-PENALTIES
The headquarters of JP Morgan Chase on Park Avenue December 12, 2013 in New York. STAN HONDA—AFP/Getty Images

JPMorgan will pay the lion's share, followed by UBS and Credit Suisse

The European Commission levied a $120 million fine against JPMorgan, UBS and Credit Suisse on Tuesday, for manipulating key interest rates through an illicit cartel.

JPMorgan incurred the largest fine, $79 million (62 million euro), for fixing the Swiss franc Libor interest rate, Reuters reports. The bank will pay an additional $13 million (10.5 million euro) for participating in a cartel with UBS and Credit Suisse to rig interest rates on derivatives.

UBS and Credit Suisse will pay $16 million and $12 million fines, respectively, though Royal Bank of Scotland escaped sanctions for alerting European regulators to the price fixing scheme.

[Reuters]

TIME apps

People Can Now Pay Each Other Via Twitter in France

BRITAIN-INTERNET-COMPANY-TWITTER
The logo of social networking website 'Twitter' is displayed on a computer screen LEON NEAL—AFP/Getty Images

Digital payments in 140 characters or less

A new digital payment service in France will let people pay each other via Twitter for free.

French banking group BPCE announced details Tuesday about the new app, S-Money, which can be downloaded from iTunes or Google Play and allows users with a French credit card and phone number to link their card information to Twitter to begin making payments to other individuals or organizations and companies that have downloaded the service.

Payments are capped at 250 euros (about $317) for individuals and 500 euros ($635) for charities in times of crowd-funding. Users also have to use a specific format for their payments to be accepted. S-Money has opted for € rather than the written version of euros, for example.

While other digital payment platforms have the option of privacy for payments, all Twitter payments are visible to the public–so discretion is advisable.

TIME Banking

Banking by Another Name

Traditional lenders aren't doing their job. Enter a raft of startups to do it for them

You know credit is tight when the former chair of the Federal Reserve can’t get a mortgage. Ben Bernanke, who isn’t exactly hard up (he reportedly makes at least $200,000 a speech), recently lamented that he wasn’t able to refinance his home because of tight credit conditions. This is an inglorious reminder that the housing recovery is being driven not by first-time home buyers or people who want to trade up but by wealthy people who don’t need a loan. Since most middle-class Americans still hold most of their wealth as equity in their homes, we won’t achieve a sustainable recovery until we fix the housing market.

Banks would say the difficult credit conditions reflect the higher costs of complying with new regulations like Dodd-Frank. There’s some truth to that but not enough to justify turning down nearly any borrower who can’t put down 30% cash on a house. A more accurate explanation is that home-mortgage lending isn’t nearly as profitable as securities trading, which is where big banks still make much of their money these days. And so, hidden in the sluggish housing recovery is another revolution: American banks continue to morph into investment houses in ways that could ultimately put our financial system at risk.

Rather than Bemoan this, I am encouraged by some of the innovative companies trying take advantage of these shifts. A whole new category of nontraditional lenders is springing up to take traditional banking’s place. Nonbank financial firms, a category that includes everything from companies like Detroit-based Quicken Loans to peer-to-peer lenders like the Lending Club, are growing exponentially. (Peer-to-peer lending is the relatively new practice of lending money to unrelated individuals without going through a traditional intermediary like a bank.) This category of nonbank banks is taking up a lot of the slack left by traditional banks in the aftermath of the financial crisis. During the first half of this year, almost a quarter of mortgages made by the top 30 lenders came from nonbank firms, the highest level since the financial crisis began.

Many of these lenders use unconventional metrics to judge how creditworthy borrowers really are. They’re focusing not just on borrowers’ salary and tax returns, which are the basis of most traditional mortgage-lending calculations, but also on their field of work, what kind of degree program they are in or what their potential income trajectory might be.

Such metrics enable these lenders to take on risks that traditional banks now shun. “There’s a misperception out there that millennials don’t want to buy a home,” explains Mike Cagney, CEO of Social Finance, a company that has already done over $1 billion in crowdsourced student-loan refinancing and is now pushing into the online mortgage market. “But the reality is that they don’t have the credit to do it.” Cagney says many of his initial mortgage borrowers mirror the profile of the customers to whom he gives reduced-rate student loans–upwardly mobile young professionals, many with degrees from top schools, who have bright futures in high-income professions but little cash in the bank. Particularly on the coasts, where real estate prices are high, it is nearly impossible for a young person to buy a home with a traditional credit profile.

Of course, it’s not only upwardly mobile future members of the 1% who deserve a break on credit. Research shows that many low-income borrowers with steady jobs are much better credit risks than they look like on paper. One University of North Carolina study found that even poor buyers could be better-than-average credit risks if judged on metrics other than how much cash they have on hand. That’s not to say we should have runaway borrowing as we did in the run-up to 2008, but credit standards are still very tight relative to historical averages.

Nontraditional lending has already shown there is an alternative to the not-very-public-minded banking system we have in place now. That raises the question, Why should big banks whose primary business model is no longer consumer lending be government-insured in the first place? (Many would argue that the bailout guarantee implicit in such insurance was the reason the too-big-to-fail institutions were able to leverage up and cause the subprime crisis in the first place.) Perhaps the safest thing would be for banking as a whole to go back to a model in which institutions simply keep a lot more cash on hand, or have unlimited liability as a hedge against risk taking? Who knows? That might make mortgage lending look good again.

MONEY Financial Planning

Here’s What Millennial Savers Still Haven’t Figured Out

Bank vault door
Lester Lefkowitz—Getty Images

Gen Y is taking saving seriously, a new survey shows. But they still don't know who to trust for financial advice.

The oldest millennials were toddlers in 1984, when a hit movie had even adults asking en masse “Who you gonna call?” Now this younger generation is asking the same question, though over a more real-world dilemma: where to get financial advice.

Millennials mistrust of financial institutions runs deep. One survey found they would rather go to the dentist than talk to a banker. They often turn to peers rather than a professional. One in four don’t trust anyone for sound money counseling, according to new research from Fidelity Investments.

Millennials’ most trusted source, Fidelity found, is their parents. A third look for financial advice at home, where at least they are confident that their own interests will be put first. Yet perhaps sensing that even Mom and Dad, to say nothing of peers, may have limited financial acumen, 39% of millennials say they worry about their financial future at least once a week.

Millennials aren’t necessarily looking for love in all the wrong places. Parents who have struggled with debt and budgets may have a lot of practical advice to offer. The school of hard knocks can be a valuable learning institution. And going it alone has gotten easier with things like auto enrollment and auto escalation of contributions, and defaulting to target-date funds in 401(k) plans.

Still, financial institutions increasingly understand that millennials are the next big wave of consumers and have their own views and needs as it relates to money. Bank branches are being re-envisioned as education centers. Mobile technology has surged front and center. There is a push to create the innovative investments millennials want to help change the world.

Eventually, millennials will build wealth and have to trust someone with their financial plan. They might start with the generally simple but competent information available at work through their 401(k) plan.

Clearly, today’s twentysomethings are taking this savings business seriously. Nearly half have begun saving, Fidelity found. Some 43% participate in a 401(k) plan and 23% have an IRA. Other surveys have found the generation to be even more committed to its financial future.

Transamerica Center for Retirement Studies found that 71% of millennials eligible for a 401(k) plan participate and that 70% of millennials began saving at an average age of 22. By way of comparison, Boomers started saving at an average age of 35. And more than half of millennials in the Fidelity survey said additional saving is a top priority. A lot of Boomers didn’t feel that way until they turned 50. They were too busy calling Ghostbusters.

MONEY Customer Service

3 Industries That Desperately Need Customer Service Makeovers

Chimpanzee on a telephone
Brad Wilson—Getty Images

Comcast is hardly the only company that should be doing some soul searching and commit—not only with words but actions—to making customer service genuinely better.

Because the state of customer service has been bad for so long, and because we’ve heard many times over that some or another big initiative would improve customer service dramatically only to have little or no impact, we’re skeptical about the effectiveness of any broad campaign supposedly crafted to address age-old customer grievances. Nonetheless, it was good to see Comcast’s recent announcement that a long-serving executive named Charlie Herrin had been named as the company’s new senior vice president of customer experience. “Charlie will listen to feedback from customers as well as our employees to make sure we are putting our customers at the center of every decision we make,” a message from Comcast president and CEO Neil Smit explained on Friday.

Read between the lines and it sure looks like Comcast is acknowledging that in the past, customers haven’t exactly been top of mind when it comes to company decisions. That’s no revelation to consumers, of course, who have routinely dinged Comcast for terrible customer service. In 2014, Comcast “won” the annual Worst Company in America competition as voted by Consumerist readers, the second time in recent years it has nabbed that dubious honor.

While it’s unclear what Herrin and Comcast will do to improve customer service, the first step in solving a problem is acknowledging that you have one, which Smit did more squarely when he said, “It may take a few years before we can honestly say that a great customer experience is something we’re known for. But that is our goal and our number one priority … and that’s what we are going to do.” To which the consensus reaction among consumers is … it’s about damn time. Followed by, we’ll believe it when we actually see real,meaningful change.

To be fair, it’s not just Comcast that’s sorely in need of a customer service makeover. Here are three entire business categories that are regularly bashed for not putting customers’ needs first on the agenda.

Pay TV & Internet Providers
Current Comcast competitor and likely merger partner Time Warner Cable is also a regular contender for the worst service title, as are other pay TV-Internet providers including DirecTV and Verizon.

Among the complaints are that there is a lack of true competition in the category, because roughly three-quarters of Americans have exactly one local choice for a high-speed Internet provider. A survey published this summer indicated that more than half of Americans would leave their cable company if they could, and nearly three-quarters said that pay TV providers are predatory and take advantage of the lack of competition. Among the most hated pay TV practices that consumers would love to see changed are promotional rates that are replaced by skyrocketing monthly charges, frustrating and time-consuming run-ins with customer service reps, and bundled packages overloaded with channels and options the customer doesn’t want (let’s add smaller packages and a la carte channel selection, please).

Wireless Providers
The good news for cell phone users is that customer satisfaction is on the rise, increasing 2.6% according to the 2014 American Customer Satisfaction Index (ACSI). The bad news, however, is that while we’re happier with the actual gadgets (from Samsung in particular), satisfaction with the companies providing our cell phone service—including AT&T, Verizon, T-Mobile, and Sprint—remains stagnant and below average.

Plenty of other studies also show just how frustrated and dissatisfied consumers are with wireless providers nowadays. A vote-off at Ranker.com, for example, placed AT&T at the top of the list of “Companies with the Worst Customer Service.” Among the many problems consumers have with wireless providers is that choosing a handset and data-minutes-texting package is absurdly complicated, with countless permutations, obfuscations, and mysterious add-on charges. This past weekend, a New York Times columnist presented a painstaking step-by-step analysis of why the $199 price advertised for the new iPhone 6 is a joke—because by the time fees and monthly upcharges are tacked on, upgrading to the new phone will easily run more than $600.

“Wireless service has always been one of the most complex purchases a human can possibly make,” Eddie Hold, a wireless industry analyst with market research firm NPD Group, summed up in a Consumer Reports story last year. “It’s always been horrific.”

Banks
Number 3 on the Ranker list of companies with the worst customer service, just below AT&T and Time Warner Cable, is Bank of America. Another study, from 24/7 Wall Street, used customer service surveys to put Bank of America in the #1 spot for its Customer Service Hall of Shame, and two other banking institutions, Citigroup and Wells Fargo, are in the top (bottom?) 10. (The study factored in ratings for these institutions’ banking and credit card services.)

What may come as a surprise—a sad and ironic one, at that—is that customer satisfaction with banks is apparently at a record high. The 2014 J.D. Power study on U.S. Retail Banking Satisfaction indicates that big banks and regional banks have made some strides in terms of making customers happier (or less disgusted) with their service, and that overall bank scores are higher than they’ve ever been since the study has been conducted. Yet the J.D. Power study shows there’s a long way to go: The most common reason given for switching banks is poor customer service, and millennials, minorities, and affluent consumers stand out as being particularly dissatisfied with today’s banks.

“Even with record high satisfaction, there are some banks that fall far short in meeting customer needs,” J.D. Power’s Jim Miller said via statement. “It is easy for banks to become complacent. To stay at the top of their game, banks should focus on those customers who are not satisfied. And consumers should keep in mind they have the opportunity to shop banks to find the right combination of services, products and fees to meet their needs.”

What’s your pick for the company with the worst customer service? Tweet us at @MONEY with the hashtag #unhappycustomer. Here’s what readers have already said. Add your nomination, and we may publish your feedback in a future post.

Related:
5 Packages That Could Replace Pay TV As We Know It
How to Pick a Bank

TIME Money

PayPal Co-Founder Takes Aim at Credit Card Industry With New Startup

Yelp Chairman Max Levchin Creates New Mobile Payments Startup Affirm
Max Levchin speaks during a Bloomberg West television interview in San Francisco on Thursday, March 28, 2013. David Paul Morris—Bloomberg / Getty Images

“You have to have a credit card. You have to use it. You are going to get screwed and you know it."

The most miserable year of Max Levchin’s life began in 2002, shortly after he sold off his ownership stake in PayPal to eBay for an estimated $34 million. “At the time, I had a fascination with the color yellow,” Levchin told TIME. He would arrive to work in a yellow car, wearing a yellow jumpsuit and hole up in his executive suite, blending in with the all-yellow office paraphernalia. His former direct reports, who numbered in the hundreds, shuffled past the door, “staring at me every morning,” he recalls, “as I would sort of mope around going, ‘My baby’s now been sold to a giant company’ while wearing a yellow clown suit.”

He was 27 years old, flush with cash and adrift in an ocean of downtime. If that sounds like your idea of heaven, then you’re no Levchin. “I literally — I think I started hearing voices,” he says. His girlfriend left him. He wrote 10,000 lines of code, a “minuscule amount,” he insists. His friend persuaded him to take a scenic drive along the Oregon coast. “We saw a lot of very beautiful places,” he says, “and I don’t remember any of it other than the fact that Oregon is a really messed up state, economically.”

Nothing could lift his spirits, short of launching another company, which he did in 2004. It was called Slide, and it was a fun ride down the chute toward another sale in 2010 to Google for $182 million, Levchin says.

Today, he knows better than to slip back into the interminable boredom of easy living. He’s in the thick of a third venture, Affirm, and to sop up the last waning moments of his spare time, he also oversees an investment fund called HVF, short for “Hard, Valuable and Fun.” “Fun” has a very peculiar definition in this case — referring to any massive, globe-spanning problem that Levchin might get to noodle over in his scrappy new office in downtown San Francisco.

Affirm’s 32 employees have set up shop on a quiet street lined by venerable brick buildings, some of which withstood the great fire and earthquake of 1906 and have the commemorative plaques to prove it. Here, Levchin is thriving in his element. His girlfriend came back. They got married and had two kids. He still favors the style of clothing that might diplomatically be called “start-up chic,” a puffy sleeveless winter vest, unzipped and revealing a weathered t-shirt that practically whispers, “I’ve got bigger things to worry about than shopping.”

In fact, though, he does worry about shopping. Obsessively. Levchin has been visiting retailers across the country, asking about the state of consumer lending. He sums it up grimly: “You have to have a credit card. You have to use it. You are going to get screwed and you know it.”

Millennials are ditching the plastic in droves. More than 6 in 10 of them say they have never signed up for a credit card, a group that has doubled in size since the financial collapse of 2007. Evidently they’d rather scrimp on their purchases than get snagged on finely printed fees or mired in debt. “Which is wrong,” Levchin says. “If you are living hand to mouth every month you’re not going to improve your standard of living and you’re not going to scale up.”

Enter Affirm, a startup that that offers consumers the option to split payments over time, which a growing number of online retailers have added to their checkout pages. Users can get instantly approved for a loan by tapping their personal phone numbers into Affirm’s welcome page. From that phone number Affirm launches into the murky world of online data. “It anchors you to a whole host of information that is entirely public, or pretty close to public,” says Levchin. It can scan for social information across social media or dip into proprietary marketing databases or combine that with credit histories. In total, the Affirm team has identified more than 70,000 personal qualities that it thinks could predict a user’s likelihood of paying back a loan. If old fashioned credit scores provide a fixed, black and white portrait of the borrower, Affirm claims to capture that borrower in full, moving technicolor.

The company is so confident in its claims that it puts its own money on the line, extending loans to people who are normally considered a risky gamble. Active duty soldiers, for instance, return home with scant credit histories. A raft of regulations require lenders to extend credit to the soldiers, even if the decision goes against their better judgement. As a result, lenders have historically eyed returning soldiers with suspicion.

“I couldn’t care less about the narrative of why that might be true,” Levchin says, “except that I know it’s actually not. From all the loans that we’ve issued I think we’ve had literally 100% repayment rate from active duty servicemen.” Of course, military service is just one of at least 70,000 variables that can tip Affirm in the user’s favor. The formula is complex by design, so that no user can game the system by, say, posting “brain surgeon” as a new job on LinkedIn and then requesting a fat line of credit.

Whether Affirm will truly upend the rules of lending or foolishly rushed in where lenders fear to tread will depend on its ability to collect interest on loans without resorting to hidden fees. After all, credit card companies do that for a reason: It’s lucrative. Affirm, on the other hand, actually alerts users to approaching payment deadlines and clearly states fee rates before they arrive.

In short, Affirm has to lend at the right rates to the right people. Fortunately for the company, it has $45 million of venture capital to test run its unified theory of lending. It also has no shortage of potential competitors circling in on the hotly contested field of smartphone payments, from Apple Pay, to Google, to Levchin’s old “baby,” PayPal, all competing for the same “under-serviced” customers, as he put it.

But perhaps Affirm’s greatest asset is Levchin himself, who was practically bred for this kind of work. His mother was a radiologist at a Soviet-era research institute, where she was tasked with extracting reliable measurements from Geiger counters. The old Soviet era instruments spewed out a tremendous amount of error data. Her manager dropped a computer on her desk and asked her to program her way to a more reliable reading. Stumped, she turned to her 11-year-old son and asked, ”Do you know anything about this stuff?” The question kicked off Levchin’s life-long love affair with programming, and it made him acutely aware of what data a machine can capture, and what essential points might elude its sensors. He points out that a heartbeat counter may measure 64 beats per minute, but it almost certainly misses a number of half-beats along the way. Affirm, in a sense, listens for those missed beats.

“The fact that we can look at data, pull it, and underwrite a loan for you in real-time is very valuable, because we can literally decide, ‘Hey, in the last 48 hours you got a new job, that changes things a little bit. Now you’re able to afford more,'” Levchin says.

Maybe that’s a hasty gamble, or maybe it’s sound financing. In either case, it’s Levchin’s idea of fun.

MONEY Banking

Here’s One Thing You Probably Shouldn’t Get at Walmart

Cracked piggy bank with Walmart logo
MONEY (photo illustration)—Getty Images (photo)

Walmart's new partnership with GoBank may be a decent option for those unable to get a checking account from a traditional bank, but most consumers (even low-income ones) can find a better deal.

When Walmart announced Tuesday that it would soon be offering checking accounts for the masses—so its customers could, ostensibly, conveniently deposit their checks where they purchase all their household goods—we saw an opportunity to compare the new banking option to its competitors.

Thanks to research compiled for MONEY’s annual Best Banks in America story, the latest version of which will be out on newsstands on November 28, we were able to measure up the new account against more than 200 other checking accounts.

But before we jump into our analysis, it’s important to understand what exactly Walmart is doing. First of all, the retailer is not technically its own bank (since its efforts to become an official deposit institution were basically foiled by the banking industry in 2007). The Walmart will simply offer a GoBank account through its partner Green Dot, an FDIC-insured banking platform that currently issues Walmart’s prepaid card.

The GoBank checking account—no savings as of yet—comes with a relatively low $8.95 monthly “membership fee” (essentially a maintenance fee) that can be waived with a $500 monthly direct deposit. But perhaps more interesting is the fact that it has no overdraft fees whatsoever, and virtually anyone—even those with terrible credit or a history of bouncing checks—will be approved for an account.

Greg McBride, chief financial analyst at Bankrate.com, says GoBank’s low eligibility requirements are unique in the industry and could be helpful to people who have frequent trouble with overdrafts. But McBride cautions that the people described make up a small subset of most consumers. Just one in seven bank customers have had more than one overdraft in the last year, meaning an even smaller subset of that group would be in dire need of GoBank’s leniency.

As it stands, the vast majority of people—even those with low incomes or mediocre credit scores—are able to qualify for checking accounts with similar or better terms than what GoBank offers, says McBride. Many competitors offer perks GoBank does not, such as interest payments or free use of out-of-network ATMs.

Below, we’ve set the account against some of the better options for standalone checking:

Account Maintenance Fee Minimum Interest Out-of-network ATM fees Overdraft fees? Credit score check to open?
Walmart’s GoBank Checking Account $8.95 (waived with a $500 monthly direct deposit) 0% $2.50 No No
E*Trade’s Max-Rate Checking Account $15 (waived with a $200 monthly direct deposit) 0.01% $0 (and all third-party ATM fees are reimbursed) Yes No, but they do check on past overdraft history.
Capital One’s 360 Checking Account $0 0.20% $0 Yes, but only $0.03 a day for every $100 of overdraft balance Yes
Ally Bank Interest Checking Account $0 0.10% $0 (and all third-party ATM fees are reimbursed) Yes Yes

For our Best Banks feature, MONEY also looked at mobile apps, and from what’s been announced so far, GoBank’s app does sound state of the art. A built-in budgeting program called Fortune Teller asks users to input their various bills and expenses, along with their salary and pay day. And once all the information is entered, users can ask Fortune Teller’s opinion before they buy something by entering in the price.

In theory, this sounds great—most people could use a virtual slap on the hand when they’re about to overspend. But the devil is in the details. It’s unknown how much of a financial buffer Fortune Teller’s algorithm leaves when it tells a person he or she can afford a purchase. And when the advice is coming, however indirectly, from a store that has plenty of things to sell to you, you’d be smart to be skeptical.

In other words, just because you can afford that $1,000 Gollum Halloween party prop doesn’t mean you should buy it. And just because you can get easily approved for this bank account doesn’t mean you should apply.

Related:

MONEY 101: How do I pick a bank?

MONEY Banking

Walmart Wants to Be Your Bank

The big-box retailer is launching checking accounts with no overdraft fees and with no monthly fees if you meet a direct-deposit minimum.

MONEY Banking

Walmart to Begin Offering Checking Accounts

Walmart wants to be your one-stop-shop for financial services as well.

UPDATED—2:37 P.M.

Walmart is no longer just your doctor, supermarket, or big box retailer. Now it also wants to be your bank.

On Tuesday, the retail giant announced it would be partnering with Green Dot Bank to begin offering Walmart customers checking accounts. The accounts will be provided through GoBank, Green Dot’s mobile checking service, and are scheduled to become available nationwide by the end of October.

To join, customers must buy a GoBank “starter kit,” which includes a starter MasterCard debit card, for $2.95. Users can deposit cash into their GoBank account at any Walmart, and each store will be outfitted with one of the bank’s 42,000 free ATMs. Green Dot claims virtually any customer who passes an ID check will be accepted, meaning even those with low credit should be able to open an account.

This is not Walmart’s first forway into the world of finance. The company previously tried to obtain its own bank charter in 2007, but was rebuffed by the banking industry. Subsequently, Walmart has provided numerous “fringe-banking” services, such as check cashing, payday loans, bill pay, money orders, and a suite of prepaid cards and checking alternatives. Many of the store’s locations feature a MoneyCenter for the company’s financial products and the Walmart website includes a section devoted to “Payday Solutions.”

In addition to foregoing a credit check, GoBank promises to offer a number of attractive features to low-income consumers. The service does not charge overdraft fees, and GoBank will waive its $8.95 monthly charge for all accounts with direct deposits of at least $500 per month. Walmart highlights one study that showed consumers pay between $218 and $314 a year for a basic checking account.

However, GoBank also does not include other common banking services. Money stored with the GoBank does not earn interest. And unlike most checking accounts, these do not offer users paper checks; instead, GoBank refers customers to its online bill-paying service.

Faye Landes, a retail analyst at Cowen investment management group, described to the New York Times Walmart’s entrance into banking as a savvy play to help the chain lure back customers who have jumped ship to even cheaper competitors. “Their core consumer, the lower-end consumer, is faring disproportionately poorly in the overall economy,” Landes told the paper. “Anything they can do to get them back from the dollar stores and back in their own stores makes total sense.”

In a press release, Daniel Eckert, senior vice president of sales for Walmart U.S., presented GoBank as an alternative for consumers who increasingly cannot afford traditional banking solutions. “This product is really designed toward Wal-Mart shoppers who find themselves dissatisfied or unhappy with the fees and costs associated with traditional banking,” Eckert told the L.A. Times, “as well as customers with a spotty record of managing their account.”

 

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