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Walmart launches fintech startup to build digital financial products for customers, employees

Walmart, the world's largest retailer, announced on Monday that it is launching a financial technology (fintech) startup in partnership with Palo Alto, Calif.–based venture capital firm Ribbit Capital, a backer of Robinhood, Credit Karma and Affirm.

The new fintech company, which will be majority-owned by Walmart, aims to “develop and offer modern, innovative and affordable financial solutions” targeting Walmart's customers and employees. Yahoo Finance's Jared Blikre discuses.

Video Transcript

[MUSIC PLAYING]

SEANA SMITH: We have some breaking news from Walmart creating a fintech startup. Jared Blikre has more details on that for us. Jared.

JARED BLIKRE: That's right. Ribbit Capital is teaming up with Walmart, and they're going to create a brand new fintech startup to, quote, "develop and offer modern, innovative, and affordable financial solutions." Sounds pretty vague, but it sounds to me like they're going to use-- leverage Walmart's retail footprint and really bring in the fintech aspect of that, the financial aspect of that to its customers.

So couple of details here. The company is going to be majority owned by Walmart. The board of that company is going to include John Furner, president and CEO of Walmart US, Brett Biggs-- he's the executive VP and CFO of Walmart-- and also Meyer Malka. He's the managing partner of Ribbit Capital.

Now Walmart is going to continue to-- this is what they're saying. They're going to continue to serve customers through their existing financial services and partnerships with a number of third parties, which include Walmart credit card, Walmart money card, check cashing, money transfers, installment financing. And they're going to be adding to that with this latest fintech venture.

Now Ribbit Capital is an investment firm. They were founded in 2012, and they are investors in Robinhood as well as Credit Karma and Affirm. Affirm provides innovative payment options for customers. That's according to the press release.

So we've seen this where even Goldman Sachs is really getting into retail more. They want to do wealth management for the retail sector, the millennials who are coming up. And this looks to me like Walmart is getting in on the action, too, along with Ribbit Capital in this new enterprise. Guys.

SEANA SMITH: Walmart moving a little higher here in after hours. All right, Jared, [? thanks so-- ?]