Global retailer Walmart is gearing up to launch a BNPL system that would be offered through its own fintech venture. In January 2022, Walmart has partnered venture capital firm Ribbit Capital, a backer of Robinhood, Credit Karma, and Affirm, to launch a financial technology startup named ONE.

The new fintech company, which is majority-owned by Walmart, aims to develop and offer modern, innovative, and affordable financial solutions targeting Walmart's customers and employees. Walmart is already offering Buy Now, Pay Later services both online and in stores through Affirm, allowing customers to pay for their products in instalments over several months. According to Walmart, what makes Affirm stand out when compared to credit cards is that it doesn’t charge any fees, including late fees, prepayment fees, annual fees, or hidden fees.

At the time of writing, it’s unclear whether Walmart will maintain its partnership with Affirm after it launches a Buy Now, Pay Later system through its own fintech venture. ONE’s product line-up already includes checking accounts, savings accounts, as well as a retail card programme, which allows customers to purchase a ONE retail card from a Walmart store and load it with money. Once the card is activated and the user has opened a ONE account, the card can be used as a debit card.

In September 2022, Reuters reported that ONE would introduce checking accounts to thousands of Walmart employees and a small percentage of its online customers as part of a beta test. According to the same source, the fintech wants to make the accounts available to Walmart's 1. 7 million employees within a year before rolling out services more broadly.

BNPL regulation in the US According to nortonrosefulbright. com,  the sudden increase of the BNPL market in the US is attracting scrutiny from financial services regulators concerned about the lack of specific rules and the potential risks to consumers. Federal regulators have taken a largely hands-off approach to the BNPL sector in the past, but recent changes are pointing towards an increase in US regulation of BNPL.

A report issued by the Consumer Financial Protection Bureau (CFPB) reveals plans for increased regulation in the BNPL industry, especially in those areas where there is a risk of consumer harm. The report identifies several competitive benefits of BNPL products over legacy credit products and discusses areas of potential consumer risks. For instance, BNPL can sometimes appear to be a zero-risk credit option, while in reality some market participants' offerings are structured to evade certain federal consumer lending requirements.

In this context, the CFPB will pursue several additional steps in relation to BNPL products, including identifying the data surveillance practices that BNPL providers engage in that may need to be curtailed, as well as taking steps to ensure that BNPL providers are subjected to appropriate supervisory examinations. .