Former Clinton Labor Secretary Endorses Wal-Mart's Entry into Banking

Robert Reich supports competition in banking from Wal-Mart:

Wal-Mart wants to start a bank. Well, not exactly a bank. Wal-Mart says all it wants to do is provide customers with its own credit-card service on Wal-Mart sales, so it can trim costs on the millions of payments it processes each year. Wal-Mart has been telling bank regulators it has no intention of expanding into other banking services.

Most Wal-Mart watchers (including the entire U.S. financial industry) don’t believe Wal-Mart. They see this move as the Wal-Mart camel’s nose under the tent of commercial banking. First come credit-card services on Wal-Mart sales, then discounted credit-card services on other sales, then commercial deposits and loans. Presto. Before you know it, Wal-Mart is a full-service commercial bank.

I say, let Wal-Mart under the tent. Commercial banking is now one of the stodgiest and least-competitive parts of the American economy. Fees and prices are way too high. Service is lousy. The industry needs a shakeup. Have you ever had a bank give itself an interest-free “float” on your money while you waited two weeks for a check to clear? Have you ever filled out twenty-five forms to get a simple bank loan? Have you ever collected anything close to fair interest on money you keep in your checking account?

I guarantee you Wal-Mart’s low-price business model will force complacent bankers to do better.

Also bear in mind many Wal-Mart customers don’t have much money. They need cut-rate banking services. Many of these folks are excluded from mainstream banking. They don’t even have bank accounts. Wal-Mart could help them.

The former Labor Secretary is for letting consumers choose where they want to bank instead of politicians limiting choice.I guess some people want juicy ATM fees and some don't.