Walgreens depends on bank card and monetary companies to drive gross sales
People wearing masks walk on a zebra crossing near a walgreens on September 30, 2020 in New York City.
Alexi Rosenfeld | Getty Images
Walgreens announced Wednesday that it will offer a growing list of financial products to customers – including a co-branded credit card and a prepaid debit card – as it seeks to get more of their wallets and help them manage expensive medical expenses to help.
The credit cards will be introduced in the second half of this year. They will be part of the Mastercard network and will be issued by Synchrony. They will be linked to Walgreens’ new loyalty program, which the company relaunched in November with a new name, perks, and pandemic-inspired features such as roadside pickup and delivery via DoorDash and Postmates.
Walgreens and his drugstore counterparts are adapting to rapidly changing consumer behavior that accelerated during the pandemic. Walgreens has been looking for new business opportunities including a deal with VillageMD to open hundreds of primary care clinics in its branches.
John Standley, president of Walgreens, said the company also sees financial services as one of those growth drivers. “As we continue to focus on generating new revenue streams, we look forward to researching and rolling out even more health and wellness payment initiatives in the near future,” he said in a press release.
It is the second major retailer this week to announce plans to expand into financial services. Walmart said Monday that a fintech start-up is doing it with Ribbit Capital, one of the venture capital firms that support Robinhood. The separate company will be majority owned by the big box retailer.
The pandemic and recession have put pressure on many families to try to stretch their money as they pay the bills and cope with reduced hours or unemployment. During the holidays, for example, a growing number of consumers looked for other ways to finance their purchases. Use of “buy now, pay later” for online orders increased 109% during the Christmas shopping season, November 1 through December 31, with the largest spike occurring in the last week before Christmas, according to a recent foreclosure report.
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