PayPal to Launch New Cash Back Rewards Card Amid Consumer Belt-Tightening Trend

At a time when people across the United States and around the world are trying to keep as much money in their pockets as possible, PayPal has announced the PayPal Cashback credit card, giving customers unlimited 3% cash back with every PayPal purchase and 2% cash back on other purchases, according to a Tuesday (April 5) press release.

Retail behemoth Amazon and buy now, pay later (BNPL) platforms Affirm and Afterpay are just a few of those competing for customers’ attention with cash back rewards offerings.

“Our customers shopped across 34 different categories last year showcasing the diversity of their needs and interests, and we wanted to build a credit product that was flexible and better matched rewards with their spending behaviors,” said PayPal Vice President of Consumer Credit Susan Schmidt in the release.

The PayPal Cashback credit card, issued by Synchrony, gives shoppers 3% back when they pay with PayPal whether they buy online using their mobile devices or in stores with the PayPal QR code, the release stated. The card has no annual fee and can be added to a customer’s PayPal wallet.

“Together with PayPal, we continue to build on the seamless integration that has been a hallmark of our partnership, allowing us to enhance rewards to our customers and improve the user experience,” said Synchrony CEO of the Digital Platform Bart Schaller in the release.

“Existing eligible PayPal 2% Cashback credit card holders will automatically be upgraded into the new 3% cash back card structure” and earn higher cash back rewards every time they use their card to check out with PayPal, according to the release.

“The new PayPal Cashback credit card will soon be available to select customers who can apply through the PayPal app and www.paypal.com and will continue to roll out in the coming weeks,” the release stated.

PYMNTS’ “The Truth About BNPL and Store Cards,” a collaboration with PayPal based on a survey of 2,161 consumers, showed that they use store cards to pay for store card-eligible purchases 87% of the time.

Read more: Rewards Programs Are the Top Reason Consumers Use Store Cards