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Walmart and Shopify Team Up On E-commerce Marketplace

The collaboration between Walmart and Shopify is all set to conquer the e-commerce industry. They will provide fierce competition for Amazon, as around 1200 companies selling on Shopify will now be able to sell on Walmart U.S by the end of this year.

shopify payment processing

Shopify’s vice president of product, Satish Kanwar, considers Walmart of size and scale that only a few companies manage to match. He sees the deal as lucrative and fruitful for small and medium-sized businesses that will provide easy access to a whopping 12 million customers visiting Walmart every month.

The partnership between the world’s largest retailer, Walmart, and the e-commerce giant, Shopify, is an attempt to diversify the range of products and expand profitability. Other than this, it is a calculative move by both the companies to have a firm grip on the surge in online shopping because of the COVID-19 pandemic. According to a blog post by Satish Kanwar, their expertise in multi-channel commerce, coupled with Walmart’s reach, will storm the e-commerce industry. Furthermore, the alliance will lead to a better online shopping experience, both for merchants and consumers.

Walmart is No.2 to Amazon in U.S e-commerce space, but it has still suffered losses on occasion. The collaboration will boost both the scale and size of the business and generate more revenue.

Previously, Walmart CEO Doug McMillon expressed dissatisfaction with the way the marketplace was performing and appointed a new executive, Jeff Shotts. He also believed that the company had not done enough to support the marketplace sellers. The restructuring is an attempt to give the marketplace business a sound direction and provide sellers with all the necessary tools and services. In addition to this, he deemed it essential to successfully integrate the online business with its physical stores.

walmart apps online ordering

Both of the companies have been discussing this idea on and off, but only for the past six months have the talks intensified allowing for the plan to finally come to its fruition. They conducted a pilot test before the announcement with numerous Shopify sellers. The experiment turned out well, and Jeff Clementz saw potential in terms of thousands of sellers making their way to Walmart.

The partnership comes with its fair share of risk, but is likely to prove successful considering that Walmart is invite-only. This means it can vet the sellers to avoid any suspicious sellers. In addition to this, it also uses keyword recognition technology and uses machine learning to spot fraudulent sellers.

The Shopify merchants in the U.S will send out their application to Walmart to seek approval of selling. Once approved, their Shopify store will connect to their Walmart Seller Account. This will tie their product catalogs there and create product listings on Walmart. This way, it will be easier to track, monitor, and upgrade the inventory. Moreover, order and inventory management, in addition to the listings, will be in complete harmony.

PayPal’s Xoom Launches Domestic Money Transfers with Walmart

PayPal’s international money transfer service Xoom has this week made the announcement that, for the first time, their customers will be able to make money transfers to recipients in the United States. These P2P mobile payments will occur in a matter of minutes thanks to strategic alliances set up with Walmart and money transfer company Ria.

Near Field Communication Mobile PaymentThis has the potential to benefit more than 44 million foreign-born men and women who are living in the U.S. and regularly send money to friends and family back in their native countries. The partnership with Walmart allows Americans to take advantage of Xoom to send money to one of almost 5,000 locations all over the country for almost immediate cash pickup.

In a statement earlier this week, Vice President and General Manager of Xoom Julian King said, “Many of our customers in the U.S. already send money to loved ones in the country, and they usually prefer that the money is available right away.” He went on to say, “This rollout reinforces our commitment to make money transfers fast, easy and affordable for everyone, whether they are at home or on the go.”

In addition to King’s statement, CEO of Euronet’s Money Transfer Segment Juan Bianchi said, “At Ria, we are delighted to further consolidate our relationship with Xoom and Walmart. Our continued partnership is a fine example of how Ria’s technology can serve as an enabler between platforms, offering consumers and partners an added layer of security and compliance screening, in turn facilitating value creation within the Fintech ecosystem.”

All of this comes shortly after Xoom expanded into the United Kingdom and European markets earlier in July with remittances being paid out to individuals living in 130 countries such as India, China, Nigeria, and the Philippines. Xoom also made the announcement in October that individuals in the United States, Canada, the United Kingdom, and 31 other European markets are now able to directly send P2P payments to South Korean bank accounts. In only a matter of minutes, money can be sent from the app and received by Woori Bank, Shinhan Bank and Kookmin Bank.

Xoom has set themselves up as a pioneer in digital remittances by offering their customers fast and secure ways to send money and pay bills for friends and family living in over 160 countries worldwide. For many of these people all over the world, these remittances serve as something of a lifeline and help them to pay their day-to-day expenses such as medical bills, utility bills, and education costs. In the more traditional ways of old, the cash-based system of sending money to other countries has been full of costly fees, paperwork, and a load of uncertainty as to whether the money will arrive, or if the money will arrive in time for when it’s needed. PayPal and Xoom have been helping to improve and expand the finances of millions worldwide by providing them with speedy, secure payment options when sending money or making mobile payments across borders, only with none of the aforementioned drawbacks.

Wal-Mart Sues Visa

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The swipe fee antitrust lawsuit that The Official Merchant Services Blog has been covering for a few years now has an update: Wal-Mart, accusing Visa of excessively high card swipe fees, is suing Visa for $5 billion. The action by Wal-Mart is being taken because Wal Mart opted out of the settlement of the class action lawsuit between merchants and Visa and MasterCard.

This follows our previous report of the Minnesota Twins also opting out of the settlement. Wal-Mart filed the suit Tuesday, March 25, in the U.S. District Court for the Western District of Arkansas, where Wal-Mart is headquartered.

Wal-Mart’s Side of the Suit

Wal-Mart, the world’s largest retailer, is seeking damages from price fixing and other antitrust violations that it claims took place between January 1, 2004 and November 27, 2012.

In its lawsuit, Wal-Mart contends that Visa, in concert with banks, sought to prevent retailers from protecting themselves against those swipe fees, eventually hurting sales. Wal-Mart stated in court documents: “The anticompetitive conduct of Visa and the banks forced Wal-Mart to raise retail prices paid by its customers and/or reduce retail services provided to its customers as a means of offsetting some of the artificially inflated interchange fees. As a result, Wal-Mart’s retail sales were below what they would have been otherwise.”

Wal-Mart contends that that the way Visa set up the swipe fees violated antitrust regulations and generated more than $350 billion for card issuers over the time period in question, in part at the expense of the retailer and customers.

Case History

The antitrust case against Visa, MasterCard and several issuing banks stemmed from the dispute relating to the percentage of credit card transaction fees that retailers must remit to the credit card processing network. The fees generally range from 1.5 to 3 percent and are shared with the bank that issued the card. Also known as “swipe fees,” these charges serve to underwrite the supporting infrastructure that allows businesses to accept and process credit cards.

Large retailers and supporting associations have repeatedly complained about the costs associated with accepting credit cards and the fees for merchant services. These grievances resulted in a number of lawsuits filed in 2005, which were eventually consolidated into a single case known as the Payment Interchange Fee and Merchant Discount Antitrust Litigation.

There were 139 parties involved as plaintiffs, and the case was active for over eight years. In July 2012, a settlement was reached that provided $6 billion in damages to affected retailers and another $1.2 billion for a temporary reduction in interchange fees. As a further concession, Visa and MasterCard eliminated certain rules for merchant services that prohibited surcharging, which is a practice that allows retailers to recoup credit card costs by passing them on to the consumer.

After a settlement was reached in the case, major retailers such as Target, Nike, Home Depot, Lowes, Starbucks and Best Buy ultimately opted out of the settlement. Major trade organizations, including the National Restaurant Association (NRA), have voiced significant opposition to the agreement. In fact, the NRA strongly encouraged its constituent members to reject the settlement and highlighted the potential negative impact it could have on the emerging mobile payments market.

The Saga

To review the full extent of this ongoing saga, you can read our previous coverage of this settlement: