Sam’s Club, a division of Wal-Mart, will start offering online payday loans through Superior Financial Group LLC. The loans are for small business owners and entrepreneurs. Superior Financial Group is one of the leading Small company Administration payday loans direct lender, and it has partnered up with Sam’s Club on a trial basis to expand services that extend to small company owners that are members of the warehouse retail wing of the Wal-Mart empire.
Wall Mart getting into financial services
Wal-Mart has been looking for a way to get into the banking game. In 2007, Congress blocked non-banking entities, including retailers, from opening banks of their own. Sam’s Club has seen some shrinking revenues but has decided to give this trial program a go, as outlined by the Wall Street Journal. The loans accessible to small company owners that are members with Sam’s Club will range from $ 5,000 to $ 25,000, and will carry a term of 10 years at 7.5 percent interest.
Bolstering membership
Sam’s Club has been seeing some revenue difficulties. The Costco competitor had to shutter 10 stores most recently. The program would offer more services to small business customers, who make up a significant part of their customer base. Wal-Mart already offers check cashing and VISA Check Cards and has MoneyGram locations in numerous stores that offer financial services such as money orders, payroll loans and cash advances.
Will this pan out for Wal-Mart?
The Sam’s Club online loans will only be a pilot program. According to Business Week, the loans will be for start up businesses, and especially for companies run by women and minorities. If Sam’s Club can make a success of this program, it will certainly make it hard for small businesses to pass up a membership.
Citations
online.wsj.com/article/BT-CO-20100706-710011.html
businessweek.com/news/2010-07-06/wal-mart-s-sam-s-club-to-test-online-loans-to-members-update2-.html
