Walmart Credit Cards Return to Synchrony After Fintech Pact

Walmart’s credit cards will once again be issued by Synchrony Financial as the world’s largest retailer makes a renewed push into financial services.

OnePay, a financial technology firm backed by Walmart, picked Synchrony to issue both a co-branded card that can be used outside Walmart as well as a private-label card that will be available just for purchases at the retailer. OnePay will begin offering the cards in the US later this year.

Synchrony issued the Walmart credit card for nearly two decades until 2018, when it lost the partnership to Capital One Financial Corp. The latest deal does not include the balances tied to Walmart’s existing credit card program, according to people familiar with the matter, who asked not to be identified as the information isn’t public.

The cards will run on Mastercard Inc.’s payments network, according to a statement, which confirmed an earlier Bloomberg News report. Shares of Synchrony rose 2.8% in early trading in New York.

The move is the latest sign that Walmart is looking to weave itself into the financial lives of millions of its shoppers, and it’s betting that OnePay, which is structured as an independent company, is its best shot at doing so. While the fintech is majority owned by the retailer, it is also backed by investment firm Ribbit Capital.

Traditional financial firms have been warily watching as giant retailers muscle into their turf, and are increasingly worried that such moves will eat away more business. For instance, JPMorgan Chase & Co. boss Jamie Dimon in 2023 identified the competitive threat of businesses like Walmart, labeling their hundreds of millions of customers and the enormous resources at their disposal an “extraordinary competitive advantage.”

The Comeback

Synchrony is best known as one of the largest issuers of co-brand credit cards, counting the likes of JCPenney, Lowe’s Cos, Amazon.com Inc. and PayPal Holdings Inc. as partners. It also renewed its 30-year relationship with Walmart-owned Sam’s Club last year.

Those five partnerships accounted for more than half the interest and fees the bank earned on its loans in 2024, according to a regulatory filing.

Walmart’s decision in 2018 to move to Capital One was a blow to Synchrony and the companies’ ensuing divorce spilled into court as negotiations faltered over whether to shift billions of dollars in balances to Capital One. Capital One ultimately agreed to buy about $9 billion worth of loans tied to the portfolio.

Capital One’s relationship with Walmart soon became rocky and the retailer ended up suing the lender in 2023 in order to curtail the partnership, arguing the bank had failed to meet critical standards for customer care. A federal judge ruled in Walmart’s favor last year and the two firms promptly announced they’d be terminating their deal.

At the time of the breakup, the existing card program had loan balances of $8.6 billion and roughly 10 million customers hooked to it.

Challenging Banks

Co-brand and private label credit cards are a crucial way that many merchants and card issuers use to monetize a customer’s loyalty to a certain brand or store.

To that end, the new card will be the latest avenue of growth for OnePay, which already offers a variety of banking, lending and payment products. Walmart recently poured more resources into the venture, leading a $300 million fundraising round alongside Ribbit Capital that valued the fintech at $2.5 billion.

Walmart’s so-called Money Centers allow customers to cash checks, get their taxes prepared, pay their bills and access money orders. In some ways, with more than 4,600 stores across the US, the company already operates a network of branches that would rival those of JPMorgan, Bank of America Corp. and Wells Fargo & Co.

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