US Bank has launched an alternative to buy now, pay later schemes with the roll out of a credit card that automatically splits purchases into a three-month payment plan.
The Split Card can be used to shop in-store or online everywhere Mastercard is accepted, and every purchase is automatically split into a three-month payment plan with no interest or annual fee. Cardholders can also choose to extend payment plans to six or 12 months for larger purchases for a small, fixed monthly plan fee.
The Split Card has no APR or annual fee and comes with Mastercard World benefits including built-in travel, entertainment, shopping and protection benefits.
Chris Roncari, head of product and experience for consumer and small business payments at US Bank, says: “Split Card has elements of a typical card but is far from a typical credit card with its budgeting control and interest-free option. We expect Split Card will be a top choice for Gen Z consumers, and many others, who desire the broad scale usability, simplicity, and protections of a credit card but also need the financial consistency of equal monthly payments.”
In many ways the Split card mimics some of the features of Klarna's double-purpose debit card, which faciliates everyday spending as well as installment payments. Over a million Americans had signed up for the card within eleven weeks from its launch in the US in July.
For US Bank, the card complemens it's existing BNPL programme, ExtendPay, which gives consumer and business cardholders the ability to move eligible transactions to equal monthly payments.