It seems that Wal-Mart wasn’t able to obtain a bank charter and that doesn’t seem to be a problem. Financial services is a small part of their business. Since they have the largest volume than any other company in the US, they tried to form a bank charter. The reason was they could become a sponsoring bank with Visa/MasterCard and save that profit that goes to their current sponsoring bank since all merchants must be sponsored one.
However, it doesn’t seem to have bothered them that much besides the miss opportunity of extra savings. Without one, they have been spending the past few years building a portfolio of financial services and have become a big competitor to traditional institutions, especially ones targeting low-income consumers. One of their major products are the pre-paid cards.
By not having a charter, they have also avoided a lot of attention from Washington on this issue. The issue being the separation of banking and commerce. Wal-Mart originally filed for a charter in Utah back in 2005, but withdrew two years before the Obama admin revealed reform that would eliminate specialty charters. Wal-Mart has also learned that just because you do not have a charter, doesn’t mean you cannot have your share of the financial industry. With over 2 million customers using their pre-paid product, they are on their way to becoming a big leader.