PayPal’s Credit Card Will Provide Up To 3% Cashback
PayPal is refurbishing its co-branded PayPal Cashback Mastercard credit card, by Synchrony issues. This will further allow its users cashback of 3% when they check out using PayPal and 2% cashback on all other Mastercard purchases. As per the company, the higher rate can be used whenever a customer pays with PayPal on mobile devices or even in-store using a PayPal QR Code.
The company summaries that its existing cardholders will automatically be upgraded from the previous 2% cashback rate to 3% on their purchases. The company will also issue new cards to new customers through the PayPal mobile app and PayPal.com in the coming weeks ahead.
Along with the key feature of PayPal of cash upgrade, it has also updated the user interface for card management within the app, making it easier for customers to access their rewards, manage their purchases, and make payments. Additionally, customers will be able to access their rewards every day without waiting for a monthly statement cycle. Furthermore, they’ll be able to choose how they want to use rewards. These rewards include making statement purchases, shopping from retailers, or transferring funds to a linked bank account or debit card.
To promote new sign-ups, PayPal encourages customers with a $100 cash back bonus on the first $500 spent on the card that will not have any annual fees.
The consumer-friendly development of the credit card comes as PayPal faces more competition from buy now, pay later (BNPL) firms in the e-commerce space. For instance, in December, Afterpay collaborated with Rakuten to let shoppers earn cashback rewards when they made installment purchases from participating merchants. In addition, Affirm also launched its Cash Back program. Finally, retail giant Amazon offers its cashback rewards, which pay 3% for Amazon and Whole Foods purchases.
Susan Schmidt, VP of Consumer Credit at PayPal, said that their customers shopped across 34 different categories last year, showcasing the diversity of their needs and interests, and they wanted to build a credit product that was flexible and better-matched rewards with their spending behaviors. He further added that the new PayPal Cashback credit card was designed so PayPal customers can earn rewards and get cashback for everyday purchases, no matter what categories they spend in that particular month.
In February, PayPal’s news came on mixed Q4 2021 earnings. The payments company blamed issues like the eBay transition, inflation, supply chain issues, and more for its weaker guidance, revenue pressure, and slower user growth. If broadly classified, PayPal is up against various online and mobile payments competitors, including the built-in mobile payment systems Apple Pay and Google Pay, the various BNPL firms, Amazon’s checkout, and rivals like Cash app and Zelle.