PayPal (PYPL) is introducing a new cashback credit card. The digital payment company has teamed up with Synchrony Bank (SYF) to launch the PayPal Cashback Mastercard, which offers more generous cashback rewards.
The PayPal Cashback Mastercard offers 2% cashback, beating many of its peers that offer cashback of 1.5% or less.
The new credit card also expands PayPal’s rewards. The company teamed up with Synchrony in 2006 to roll out a credit card that also came with rewards as part of its efforts to build loyalty for its products.
Rewards flow into PayPal accounts
One area in which PayPal’s new reward card beats its existing card is that it’s simpler to understand. First, only people with PayPal accounts qualify for the new cashback card.
Second, users collect rewards even for purchases not made through PayPal. Third, cardholders receive cash rewards directly into their PayPal accounts, and they can use the cash to make more purchases or transfer to their bank accounts.
PayPal ramps up competition for market share
Experts view the introduction of the new credit card as part of the efforts PayPal’s making to attract more merchants to its platform.
PayPal is looking for leverage to bolster its growth and competition against the likes of Square (SQ), Amazon (AMZN), and Apple (AAPL) in the battle for control of the digital payments processor market. The chart above shows how PayPal’s top line has trended over the last five quarters.