PayPal rolls out cashback credit card

PayPal has come up with a novel new weapon to help it take over the high street - an old-fashioned plastic credit card.

  22 8 comments

PayPal rolls out cashback credit card

Editorial

This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community.

The digital payments pioneer has teamed up with Synchrony Financial on the Mastercard card, which will offer two per cent cashback on every online and instore purchase, with no annual limit, no minimum redemption amount, no restriction on how to spend rewards and no expiration.

Darrell Esch, VP commercial officer, global credit, says that trials of the card have shown that customers are using PayPal more not only in stores but also online.

Says Esch: "Our goal is to provide our customers choice and flexibility in how they pay when making purchases - whether online or in store. The PayPal Cashback Mastercard provides our customers with another innovative consumer credit option, making the payment experience seamless for each customer’s unique lifestyle."

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Comments: (8)

A Finextra member 

HSBC have been offering a cash back credit card in the UAE for a while now

A Finextra member 

Where will this cash back credit cards be rolled out? Asia, Europe?

Melvin Haskins

Melvin Haskins Managing Director at Haston International Limited

Cash back credit cards are available in the UK - the John Lewis credit card (managed by HSBC) has been offering it for more than five years. Nationwide also introduced it several years ago. However, both offer 0.5%. If PayPal offer 2% it is a significant reward.

Matt White

Matt White North America editor at Finextra

@ Srilakshmi - US

Ketharaman Swaminathan

Ketharaman Swaminathan Founder and CEO at GTM360 Marketing Solutions

2% cashback and no expiration of rewards - two signs of a killer credit card. 

Evita Periklaki

Evita Periklaki ACM / ATM Product Manager at Euronet Worldwide

How can a 2% reward be funded? 0,5% seems plausible, with interchange 0,3%. 2% however will kill the product's profitability and possibly also the market for credit cards with rewards.

Ketharaman Swaminathan

Ketharaman Swaminathan Founder and CEO at GTM360 Marketing Solutions

@EvitaPeriklaki: Per @MattWhite's comment, this card is launched in USA, where credit interchange is 2-3%.

A Finextra member 

So what is it? A MasterCard attracting Mastercard interchange fees? A PayPal card, acceptance of which merchants can negotiate directly? or just another wheeze that ensures acceptance of PayPal, using the Mastercard brand, within merchants who don't currently accept or don't want to accept PayPal?

Or is this is just another example of merchants funding card issuer rewards, which creates a potentially costly cycle for merchants while increasing PayPal's market reach and share?

 

 

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