Venmo’s P2P social payment app has become a major part of PayPal’s retail strategy, a play that’s getting a boost from a Synchrony co-branded credit card.
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The card will debut in the U.S. during the second half of 2020, with PayPal and Synchrony extending their overall 15-year consumer credit relationship. The card will draw on Synchrony’s program management and data analytics, and Venmo’s mobile design and social tools.
The Ebay Inc. Venmo application (app) is arranged for a photograph on an Apple Inc. iPhone 5s in Washington, D.C., U.S., on Friday, Aug. 22, 2014. After downloading the Venmo mobile-payment app onto a smartphone, users can connect them to bank and credit-card accounts, and then link up with friends to send and receive money on-the-go. Venmo, based in New York, alone handled $314 million in mobile payments in the first quarter of this year, up 62 percent from the prior quarter. Photographer: Andrew Harrer/Bloomberg
Andrew Harrer/Bloomberg
Users will apply for the card, make payments and manage their account in the Venmo app, and can receive real-time alerts as well as split and share purchases.
Venmo has been a paradox for PayPal, which acquired the app with its purchase of Braintree in 2014. Venmo is popular, particularly with younger consumers, and has gained enough traction to be competitive with the bank-led Zelle transfer app.
Yet Venmo has not made money for PayPal, leading to myriad moves to monetize Venmo, such as deals with Shopify, Hulu, BigCommerce and Jay Z’s Tidal music service. PayPal also struck a deal with American Express to include Venmo as a payment option in the Amex app, and it has pushed Venmo as an option for event ticket purchases and for payments in stores.
Synchrony has expanded its reach with recent deals with Amazon to issue a secured card and with Lowe’s. Synchrony has also developed AI-driven fraud detection and a virtual assistant called Sydney to help with financial management.
John Adams is executive editor of payments for American Banker. John interviews top executives in the payments, cryptocurrency and fintech... Read full bio
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