Should Walmart Be Your Next Bank?

FRESNO, Calif. (KFSN) -- The way people bank is changing rapidly, as every year fewer go to branches and millions embrace Internet banking. Walmart is getting into the business, teaming up with GoBank to offer online banking. Walmart also offers credit cards and prepaid cards. Consumer Reports checked out whether Walmart banking is smart banking.

Walmart's GoBank checking account costs $2.95 to open, with a minimum $20 deposit. You can then pay bills, make purchases, and get cash with the card. And there are no fees if you direct deposit at least $500 each month from your paycheck or government-issued check.

Consumer Reports says there are limitations. You won't be able to open a savings account or take out a loan. And you can't get checks yet, although Walmart says they will be available in March. The only physical thing you get when you open the account is a debit card. And unlike regular banks, there are no branches or bank officers to consult. You use your computer or mobile device for making deposits and paying bills. Direct deposit is encouraged and is free.

You can also make cash deposits with a Walmart cashier. But if someone pays you by paper check, you'll need the mobile app to deposit it. You snap a picture of both sides of the check and click to deposit. Be sure to keep the paper check until the deposit shows up in your account. There is a large national network of free ATMs, but they are used mostly for getting cash and don't accept deposits.

With the Walmart GoBank checking account, there are no overdraft fees. But if you deposit less than $500 per month, you'll pay a fee of $8.95 per month.

In spite of its limitations, Consumer Reports thinks that the Walmart checking account is worth considering. It's relatively easy to open and costs little or nothing for its basic services.

However, Consumer Reports doesn't recommend Walmart's MasterCard. Though there's no annual fee, it has a steep variable interest rate of almost 23 percent.

But if you're in the market for a prepaid card, Consumer Reports gives Walmart's Bluebird top rating. There are almost no fees, and its terms are easy to understand.