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PayPal Debuts a Credit Card That Offers 2% Cash Back (bloomberg.com)
PayPal is turning to its old nemesis, plastic, to help it expand beyond the digital realm. From a report: The online payments venture is introducing a credit card that offers customers 2 percent cash back on purchases -- one of the industry's highest rebate rates -- with no annual fee. The rewards will appear in users' online wallets and can be spent immediately on additional PayPal purchases or transferred to a bank. The move is part of Chief Executive Officer Dan Schulman's effort to transform PayPal from a payments button on websites into a versatile financial tool for everyday use, even in brick-and-mortar stores. He's forged 24 deals over the past 18 months with technology and financial companies including Apple, Visa and JPMorgan Chase, looking to make PayPal ubiquitous in the lives of its 210 million customers. The company already tested the card with some of them.
Not quite. From TFA:
>> PayPal is working with Mastercard Inc. and lender Synchrony Financial, the largest issuer of private-label credit cards, on its offer.
And they are still not a bank from any regulatory perspective (in US).
Although this deserves the +5 (maybe Funny instead of Insightful), the vast majority of people who *pay* with Paypal have a great experience. It's the merchants who choose to accept Paypal that tend to have awful stories of not getting paid. I suspect that part of the reason, though, is that Paypal will accept merchants that Visa/MC would never take on as customers. Although Square seems to have managed to go after a similar market with a much better reputation.