The Walmart-backed fintech Hazel is furthering the retailer's encroachment on banking in deals for two companies that provide services such as early payroll access and payment cards.
The retailer's financial services venture has agreed to acquire One Finance Inc., a Sacramento, California-based financial services company that offers savings, access to more than 50,000 ATMs through the Allpoint network, and mobile financial tools. The existing fintech venture will be rebranded One after the deal closes. The fintech venture also made a deal to acquire Even Responsible Finance, a Oakland, California-based firm that offers early wage access.
Financial terms of the deals, which are expected to close during the first half, were not disclosed.
Both deals will allow Walmart to quickly ramp up its financial services offerings for employees and customers. The retailer is competing against traditional banks as well as Apple, PayPal, Coinbase and other companies that are building financial super apps, which use an existing base of enrolled consumers in an e-commerce or payment app as a base to cross-sell financial services.
One's products will be made available directly to consumers, as well as offered through employers and merchants.
Walmart in early 2021 entered a partnership with Ribbit Capital, an investment firm that includes companies such as Robinhood as well as challenger banks and fintechs in its portfolio. The Ribbit Capital alliance is designed to allow Walmart to expand a number of services, such as Walmart+, a same-day delivery service and subscription e-commerce portal that's designed to compete with Amazon Prime.
Walmart also has a blockchain project that could potentially develop a stablecoin. Walmart in 2021 hired two former Goldman Sachs executives to help lead its financial services project. Omer Ismail, who led the Goldman Sachs consumer business, is heading Walmart's financial services venture. And David Stark, who led Goldman's credit card project with Apple, has also joined Walmart.
Walmart's potential financial services offerings could cater to a readymade market of 1.6 million employees and 100 million shoppers in the U.S. alone, according to The Wall Street Journal, which reported Even and One have a combined valuation of about $400 million.
