One of the reasons listed is that Visa offers high retailer fees. But another part of it has to do with its relationship with MasterCard (whether they publically admit it or not). Walmart offers its own co-branded credit card, which is a MasterCard.
Credit Card Highlights
The Walmart Rewards MasterCard is a pretty straightforward credit card. You may see the term “Walmart Reward”, which essentially just means cash back that can only be used on Walmart purchases.
- No annual fee
- Earn $25 sign up bonus ($15 after your first purchase at Walmart and $10 for going paperless)
- Earn 1.25% cash back on Walmart purchases
- Earn 1% cash back on all other purchases
Personally, I use the Capital One Aspire World Travel Elite MasterCard, for a 2% return on all purchases, including Walmart, so that’s why I would never bother signing up for the Walmart credit card. They would need to offer above the 2% mark. When Target had a co-branded credit card, they offered 5% cash back instead. Though they did end up closing up shop throughout Canada.
I don’t think that this will make that big of a difference to Walmart’s business. I am guilty of going to Walmart, because the prices are more competitive, especially with its price-match program.
I highly doubt that just because they stop accepting Visa credit cards, that it will reduce the number of customers. If anything, this is probably a start move by Walmart, as it will probably even encourage more people to sign up for their credit card. We don’t have to look further than Costco’s model, where they used to only accept American Express. Now that they switched to MasterCard only, it might have even helped their business.
With MasterCard having exclusive at 2 of the major stores in Canada, Visa and American Express have some work to do.
How do you feel about Walmart?