By Jeff Domansky, March 30, 2021
Nine thousand new bank branches will open soon in the form of US in-store and online financial services courtesy of Walgreens.
The US drugstore chain announced that pharmacy customers will soon be able to open a Walgreens bank account with a MetaBank Mastercard debit card in conjunction with a freshly updated myWalgreens rewards program.
The partnership with fintech firm InComm Payments and MetaBank will make financial services available at more than 9,000 drugstore locations and online in the second half of 2021.
“Walgreens is committed to helping customers with their health and well-being needs, and we’re pleased to expand our financial services offerings to further enrich the experiences and ways we meet customers’ financial needs,” said John Standley, President, Walgreens. “We look forward to exploring and introducing even more customer-focused health and well-being payment initiatives in the near future while creating new revenue streams.”
Financial services and rewards meet pharmacy customers
The new debit card and online services extend Walgreens’ financial services business strategy announced earlier in January 2021. The company plans to open new potential revenue streams in financial services in addition to its core business of customer health and well-being. Synchrony and Mastercard provided Walgreens’ initial credit and debit cards.
Atlanta-based InComm provides prepaid products, services, and transaction technologies to retailers, brands, and consumers worldwide. It has partnered with Walgreens for more than a dozen years and will relaunch Walgreens digital gift cards across B2B, loyalty, rewards, and e-commerce channels.
With competition from CVS, Walmart, and even Amazon, Walgreens has little choice but to look for new revenue sources. Sales in fiscal 2020 rose 2% to $139.5 billion, but operating income dropped to $1.3 billion, a decrease of 73.7% from the previous year. The company estimates an adverse COVID-19 impact of approximately $1.2 billion.
Fintech and financial growing
The company did see some bright spots in 2020. Boots.com sales rose 155%, and Walgreens.com sales rose 39% in Q4. The company expanded deliveries in partnership with DoorDash, and online sales and curbside pickup doubled compared with Q3. The company continued to manage costs through store closures and layoffs, delivering more than $2 billion in savings during 2020.
Walgreens serves more than 8 million customers daily in-store and online and filled more than 818 million prescriptions in 2020. Its online business and rewards programs have also grown. The myWalgreens rewards program now has more than 90 million members, and the myWalgreens mobile app has more than 65 million downloads.
The financial services landscape has changed dramatically in the past ten years. Walgreens is another example of the blurring of lines between traditional banks, new fintech disruptors, brick-and-mortar retailers, rewards programs, existing and new e-commerce and online channels.
A few things you might not know about Walgreens:
- opened its first Walgreens pharmacy in 1901 in Chicago
- 78% of Americans live within five minutes of a Walgreens drugstore
- invented the malted milkshake
- was among the first to use the drug child safety cap
- acquired 45% of UK-based Boots pharmacy in 2012 and in 2014 formed Walgreens Boots Alliance, the world’s first global pharmacy chain; Boots opened its first store selling herbal remedies in 1849 in Nottingham, UK
- In Oct 2019, was the first US retailer to test on-demand drone delivery service with Wing Aviation LLC.
Check out other recent PaymentsNEXT stories about retail and financial services:
Attention Walmart customers: Fintech on aisle five
Changes brewing for retailers at point-of-sale
Big US retailers hit Q2 online revenue home runs
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