Walmart is offering merchants on its platform to enjoy the benefits of embedded finance powered by the reliable banking ecosystem of JPMorgan.
US retail giant Walmart is determined to boost its marketplace with JPMorgan-powered payment services. Initially, the ability to accept payments, make transactions, and manage cash flow more efficiently via the bank’s system will be offered exclusively to American sellers.
Walmart Marketplace is the retailer’s online platform where third-party sellers can list and sell their products alongside Walmart’s own inventory. The marketplace attracts millions of shoppers, giving sellers great market exposure. Besides, sellers can integrate with Walmart’s in-store and online ecosystem, including in-store pickup and delivery. Merchants can also use Walmart Fulfillment Services (WFS) to store, pack, and ship products through Walmart’s logistics network. With the addition of an embedded finance service, they get even more features in the single package.
The partnership is supposed to increase the speed of payment processing on the retail giant’s website, which sells more than 700 million items from 100,000 merchants. It would significantly improve the marketplace operations and boost cash flows, as the platform witnesses a 40% increase in sales.
Besides, Walmart earlier said that its Marketplace is attracting more high-income shoppers. In the last quarter, about 75% of its market share growth came from households earning $100,000 or more per year. Embedded finance solutions can potentially offer seamless, integrated payment experiences that appeal to affluent customers who expect convenience and speed. It would help merchants and the marketplace build stronger relationships with these shoppers, leading to increased loyalty and higher spending.
After the launch in the US market, the joint embedded solution could be potentially implemented in Europe and other regions.
Today, more companies are using embedded finance software to provide financial services directly to customers and businesses. The embedded solutions are often available via cloud-based applications operating on the SaaS model. Integration of embedded finance brings the companies involved additional revenue streams, enhanced user experience, and improved efficiency. Besides, service providers leverage embedded finance to build stronger relationships with customers by providing them with more comprehensive solutions and significant added value.
A McKinsey report predicts that over $2 trillion in transactions will move from traditional retailers to marketplace platforms. JPMorgan sees this as a chance to grow. Its embedded finance solutions allow businesses to create limited-access JP Morgan payment accounts for their clients, facilitating controlled payouts and efficient fund movements within their platforms. The bank already has over 20 embedded finance clients and expects that number to double next year.
