Rethinking the Biggest Threat to Banks

At the BAI Payments Connect 2012 conference in Las Vegas, there has been plenty of discussion around how third-party technology vendors could disintermediate banks, especially in the area of mobile payments. But today, a panelist at a session on mobile cash access said that people aren't talking enough about what she perceives to be the biggest threat to banks: Wal-Mart.

"The most disruptive force and biggest threat to banks today is Wal-Mart," said Donna Embry, senior vice president of strategic development at Payment Alliance International, during the session. She continued, "They know their consumer -- everything about that consumer and what the consumer's preferences are."

Embry brings up a good point, especially now that Wal-Mart appears to be making an aggressive play in the mobile payments space. Earlier this month, the Wall Street Journal reported that about two dozen retailers, including Wal-Mart, are working together to develop a mobile payments system of their own.

The details of the retailers' system and how and if it works with banks remain to be seen. In the meantime, though, it probably wouldn't hurt for banks to start paying more attention to retail giants such as Wal-Mart.