Commerce Giants Expand Into Stores With New Debit and Credit Cards

PYMNTS Intelligence has long tracked the rise of the Click-and-Mortar shopper, the tech-savvy individual who traverses eCommerce and in-store shopping armed with mobile devices.

The blurring of channel lines has been paving the way for platforms — eCommerce platforms, especially — to make inroads into tangible, in-person shopping experiences.

The Click-and-Mortar shopper, we’ve found, represents a demographic that is among the fastest growing profiles. And payments preferences, the data shows, are among the key determinants of which merchants close the sale. Seventy-five percent of consumers want to use their preferred payment method when shopping.

Preference to Shop In-Store

Separate PYMNTS data indicates that shoppers were 2.9 times more likely to have shopped in store for their retail purchases than online. Seventy-five percent of zillennials reported shopping both online and in person.

Recent surveys show that health and beauty products were the most popular category purchased in-store (by 37% of consumers who made an in-store purchase). Clothing and accessories were purchased by 24% of brick-and-mortar shoppers. Additionally, Generation Z consumers showed a significantly higher propensity to buy larger ticket items like home furnishings (15%) and appliances (13%) in stores compared to other age groups.

Payment preferences include the option to pay over time, through installments through buy now, pay later (BNPL) and card-installment options.

As detailed here, 128 million adult Americans used a pay-later product from at least one alternative credit provider over the last 12 months. U.S. BNPL transactions total $175 billion. Within our estimates, in a fragmented landscape with a number of providers, Klarna has an estimated 26.2% market share, PayPal has 12.3%.

Not Skipping the Plastic

These two firms offer up prime examples of platforms that are also extending their reach firmly into the sphere of tangible commerce, with cards — the physical kind — set for rollout.

As reported this month, PayPal introduced a physical card that enables customers to use PayPal Credit for in-store purchases in the U.S. This flexible financing option can be used online, in-store and everywhere Mastercard is accepted.

The card is issued by Synchrony and paired with Mastercard’s global acceptance network, taking its place alongside the PayPal Cashback Mastercard, providing another physical option for online and in-store use.

Separately, Klarna is piloting a card that spends like debit but can flip into pay later mode, extending the BNPL model from the checkout screen to the in-store experience.

PYMNTS reported that the Klarna Card is built on Visa’s Flexible Credential, a network capability that lets a single piece of plastic surface multiple funding sources. The card lets testers in the U.S. pay from stored cash or activate Klarna’s Pay in 4 and pay later plans at any of the over 150 million merchants that accept Visa. A wider launch in the U.S. and Europe is slated for later this year.

X, which has been examining payments and other financial offerings, has floated the possibility of the launching of a X debit or credit card, which could arrive as soon as this year, according to reports.