US Private Label Credit Card Market Reinvigorated by New Competition and Product Innovation
Cleveland OH, August 8, 2023 – A new Packaged Facts report “Private Label Credit Cards in the U.S., 13th Edition
,” offers a deeply detailed analysis of the shifting strategies and emerging opportunities and challenges confronting private label card issuers and their merchant partners.
Elizabeth Rowe, author of the new report explains that while “Many believed in the inexorable slow death of store cards, the product has been reinvigorated by new competition and product innovation.”
Rebounding from declining transaction volumes in 2018-2020, the private label credit card market experienced growth in both 2021 and 2022. Growth will continue through 2025 with private label credit card nominal purchase volume growing a total of 9.8% through 2025 and card outstandings growing a total of 9.7% during the period.”
For the six largest private label credit card issuers (Synchrony Financial, Citibank’s Citi Retail Services, Capital One, TD Bank, Bread Financial and Wells Fargo), purchase volume will total $339.9 billion in 2025 and card outstandings will reach $172.9 billion in 2025.
Revitalizing growth is coming to the payment segment from both medical credit cards and newly packaged offerings providing small to mid-sized merchants private label credit cards and buy-now, pay-later (BNPL) financing through point-of-sale.
In the past five years, Buy-now, pay-later (BNPL) loans have offered buyers zero-interest short-term installment loans that have created windshear for both network-branded and private label credit cards. Packaged Facts estimates displacement of credit card purchase volume by BNPL totaled $143 billion in 2021 and will reach $279 billion in 2023.
Despite financing inroads made by BNPL, private label card issuers and merchants continue to benefit from the customer loyalty and additional revenue associated with the ownership and use of store credit cards. They have also benefited from the introduction of new products (medical credit cards) and the integration of private label BNPL and credit cards in their suite of products available to merchants.
Like other PLCCs, medical credit cards run on a closed-loop systems and are accepted at only specific healthcare providers. Unlike traditional store cards which feature the name of a retailer, medical credit cards feature the name of their own brand.
While many financing companies offer deferred interest financing for medical and dental procedures, currently, only three private label credit card issuers offer medical/healthcare credit cards: Synchrony, Bread Financial and Wells Fargo.
About Packaged Facts
Packaged Facts, a division of MarketResearch.com, publishes market intelligence on a wide range of consumer market topics, including consumer demographics and shopper insights, consumer financial products and services, consumer goods and retailing, and pet products and services. Packaged Facts also offers a full range of custom research services. Reports can be purchased at our company website and are also available through MarketResearch.com.