As Walmart turns back to Synchrony to issue its store-branded cards, the biggest winner may be OnePay, the Walmart-launched fintech. OnePay will partner with Synchrony on the new offering, expanding its portfolio—currently comprising debit cards, savings accounts, installment loans, a digital wallet, and peer-to-peer payments—to include credit cards.
Starting this fall, OnePay will offer both a general-purpose card and a private-label card for Walmart purchases. The cards will be available to millions of Walmart customers through the OnePay app.
Ready for the Big Time
Walmart launched OnePay in January 2021, but it is now co-owned by Ribbit Capital, which helped raise $300 million to power the fintech’s great leap forward this year. The capital was intended to help secure a replacement for Capital One, which had handled Walmart’s credit card business from 2018 through mid-2024.
OnePay helped Walmart add buy now, pay later (BNPL) to its roster of services earlier this year. Although there had been speculation that OnePay might handle the BNPL offering itself, Walmart ended up enlisting Klarna for that service. The latest decision may suggest that the training wheels are now off for OnePay.
Synchrony Re-Enters the Picture
Another big winner is Synchrony, which managed Walmart’s credit card prior to Capital One—before the partnership collapsed amid a hailstorm of lawsuits. After a two-decade relationship, Walmart sued Synchrony for $800 million, claiming the company was refusing to underwrite weak credit card accounts. The suit was later dropped, and Synchrony kept its status as the issuer for the Walmart subsidiary, Sam’s Club.
“The latest development between Walmart and Synchrony is an interesting rekindling between two large players in retail payments,” said Brian Riley, Co-Head of Payments at Javelin Strategy & Research. “You may recall a messy breakup in 2019, where the Walmart-Synchrony relationship fell apart due to concerns about underwriting. Walmart claimed that Synchrony’s underwriting strategy was too conservative, Synchrony felt Walmart was not risk averse. The relationship crumbled, and Walmart partnered with Capital One, which also crumbled.”
Questions remain about the quality of the market Synchrony will be re-entering.
“Walmart will need to think about the importance of risk when it returns to credit card issuance,” said Riley. “As Goldman Sachs learned with the Apple Card, high risk issuances steal profits. The same works with Walmart. The deeper you go with highly predictive FICO Scores, there must be a strategy to cover the risk. It is not about volume, but rather credit quality.”
