PayPal, Klarna launch physical payment cards
Two prominent digital payment platforms are both releasing new physical payment cards.
PayPal is introducing a new physical credit card issued by Synchrony, while Klarna is piloting a physical debit card. Following are brief overviews of each new payment product:
PayPal credit card
The new PayPal physical credit card is an upgrade of the digital PayPal Credit offering which can be used both online when checking out with PayPal and in-store and everywhere Mastercard is accepted.
At checkout, card holders can apply for a PayPal buy now, pay later loan which lets them break purchases into smaller payments over weeks or months. PayPal Credit participants can continue to obtain six-month promotional financing on PayPal purchases over $149 and also have access to a limited-time offer to pay for travel purchases over six months with promotional financing and no minimum spend.
"PayPal Credit is one of our most popular products and customers have long been requesting the ability to use it on-the-go as they look for more choice and flexibility wherever they shop," said Scott Young, senior VP, global head of consumer financial services at PayPal. "From our buy now pay later options to our credit cards, we continue to bring customers a range of solutions to help them manage cash flow and pay in the ways that suits their budgets for the things they love and need."
The new offering is issued by Synchrony, which also issues the existing omnichannel PayPal Cashback credit card, featuring a digital interface as well as a physical card.
The physical PayPal card will be rolling out in the coming weeks to U.S. customers. Eligible existing PayPal Credit customers will be notified about their card upgrade over the coming weeks.
"As a long-time partner for PayPal's credit products, we are committed to continually innovating our offerings and enhancing the customer experience," said Bart Schaller, executive VP & CEO, digital at Synchrony. "Bringing customers another physical card option to use for everyday purchases gives them greater purchasing power both on and offline."
Klarna debit card
AI-based payments and commerce network Klarna has unveiled the pilot launch of Klarna Card, a new debit card combined with access to built-in flexible payment options in partnership with Visa Flexible Credential and issued by WebBank.
The Klarna Card will allow consumers to pay immediately or pay later when needed, online or in-store, at more than 150 million Visa-accepting merchants worldwide.
The Klarna Card is currently in a trial phase in the U.S. with more than five million consumers, gathering feedback to refine the experience before a broader rollout in the U.S. and Europe expected later this year.
The card comes with an FDIC-insured wallet, which allows consumers to store money and make real-time transfers, and deposits; and integrates directly with the Klarna Pay in 4 and Pay Later flexible payment options. Klarna initially opened a waitlist for the card in 2022.
[READ MORE: Klarna to provide physical payment card in U.S.]
"We consistently hear from consumers that they want the freedom to choose how and when to pay - whether that’s paying now with debit or spreading the cost over time," said David Sandstrom, chief marketing officer at Klarna. "They want simplicity, flexibility, and transparency - all in one place. That’s exactly what has made Klarna payment methods so popular online, and now that same experience is coming to a physical card."
Once available, customers will be able to choose between one free, or two paid tiers which include merchant discounts and improved cashback rates. The card will come in three colors: aubergine, black and bright green. Debit functionality is available to all; credit is granted on a case-by-case basis following a credit check.
Currently, three apps handle most digital payment activity: PayPal-owned Venmo, CashApp and Zelle, which is jointly-owned by seven U.S. banks.
