Sam’s Club, a division of the Wal-Mart corporation, has partnered with Superior Financial Group LLC to offer online loans for its members. The loans are for small business owners and entrepreneurs. Superior Financial Group is one of the leading Small business Administration payday loan company, 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.
Not Wal-Mart’s first foray into finance
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. According to the Wall Street Journal, Sam’s Club has been losing revenue but has decided to give this online loan pilot program a chance. Sam’s Club members that are small company owners or small business accounts with Sam’s Club can apply for loans from $ 5,000 to $ 25,000, with a 10 year, 7.5 percent interest term.
Bolstering membership
Sam’s Club has been seeing some revenue troubles. The Costco competitor had to shutter 10 stores most recently. Small business owners are a significant portion of their customer base, and a business loan program would serve to attract or retain small companies as customers. Wal-Mart already offers check cashing and VISA Check Cards and has MoneyGram locations in many stores that offer financial services like money orders, paycheck loans and cash advances.
Is this the start of a beautiful friendship?
The Sam’s Club online personal loan will only be a pilot program. According to Business Week, the loans will be for start up companies, and especially for companies run by women and minorities. If Sam’s Club can make a success of this program, it will surely 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
