President Barack Obama's immigration edict is likely to enrich Wal-Mart because the previously undocumented millions would be able to use the giant discounter's new banking services.
That’s the conclusion of Diana Furchtgott-Roth, former chief economist of the U.S. Department of Labor.
Wal-Mart has made a strategic move into so-called fringe banking with its GoBank service, which includes services such as check cashing, money orders and bill pay via branchless, mobile checking accounts.
“These would be especially useful to new immigrants who have not been able to sign up for bank accounts due to lack of documentation,” she wrote in a MarketWatch guest column.
“Whatever the constitutionality of President Obama’s potential executive order on immigration, bringing undocumented workers out of the shadows and allowing them to obtain government identification will further expand GoBank’s customer base.”
Wal-Mart has been denied an official bank charter on multiple occasions, but its new GoBank partnership with Green Dot, an FDIC-insured financial services concern, apparently gives the giant retail discounter a small entry into banking nonetheless.
It is estimated about 35 million Americans are unbanked or underbanked, and millions of previously illegal U.S. residents could be added to that substantial potential market.
“One of the biggest reasons that lower-income individuals such as immigrants are unbanked and underbanked is that their previous unstable credit history makes it nearly impossible for them to pass third-party credit checks instituted by traditional banks,” Furchtgott-Roth said.
“GoBank, on the other hand, has a much more forgiving process that internally approves clients at a much higher rate, making it more accessible. Nearly everyone who can pass an identification check is approved.”
GoBank customers pay a $2.95 upfront fee to set up their account and receive a Visa or Mastercard debit card. If they deposit a minimum $500 monthly into the account, the monthly $8.95 account fee is waived. There are no overdraft fees to worry about because of the debit account status of GoBank.
Regardless of whether Wal-Mart’s foray into fringe banking is a profit maker, The New York Times reported
House Speaker John Boehner’s said Obama’s unilateral steps on the immigration issue was damaging to the presidency.
Boehner promised the House would act to counter the president bid to grant legal status to millions of illegal immigrants, but he declined to be specific on Friday.
In a blog piece for The Washington Post,
columnist Jennifer Rubin said Obama’s immigration decree has no legal basis.
“Of course, as president you don’t get to make up rules that change existing law simply because another branch won’t do what you want. That negates the essence of separation of powers and checks and balances. A president can’t take over the Congress’s delegated powers if others don’t cooperate any more than Congress can take over law enforcement or the courts can issue pardons (the president has that power),” she wrote.
© 2017 Newsmax Finance. All rights reserved.