Synchrony Says BNPL Boosts Sales Without Cutting Credit Card Use

Synchrony Financial closed 2025 with fourth-quarter purchase volume of $49 billion, a company record and a 3% year-over-year increase, as spending patterns strengthened across most platforms and co-branded cards continued to gain share, as detailed in fourth-quarter results released on Tuesday (Jan. 27).

CEO Brian Doubles said consumer behavior remained steady, adding that the company is “not really seeing any signs of weakness,” with both transaction frequency and average ticket sizes moving higher.

Pay Later has become a central part of Synchrony’s multiproduct strategy. The offering is now available at more than 6,200 merchants, and management said on the conference call with analysts that when Pay Later and revolving credit are presented together, partners see at least a 10% average increase in sales. Doubles told analysts that Pay Later customers are incremental rather than substitutive, without cannibalization of private-label and co-brand cards.

He also said repeat behavior is beginning to surface, even though Pay Later tends to start with single purchases. Over time, Synchrony aims to migrate those customers toward revolving products, using Pay Later as an entry point into longer-term relationships.

Purchase Volumes Rise Across Core Categories

Beyond Pay Later, overall card activity showed broad improvement. Co-brand and dual cards accounted for roughly half of fourth-quarter purchase volume and grew 16% year over year, supported by product upgrades and higher spend per account.

“We also continue to see year-over-year improvement in the mix of discretionary spend,” the CEO said, with strength “coming from categories like electronics, entertainment, and travel. In addition, both average transaction values and average transaction frequency continue to grow across the portfolio.”

Digital platform purchase volume rose 6%, while health and wellness spending increased 4%, driven by pet care and audiology. Lifestyle purchases advanced 3%, and home and auto slipped 2%, reflecting selective home improvement spending despite stronger ticket sizes.

Shares were down 6% in early trading on Tuesday as revenues of about $3.8 billion were slightly below consensus.

Synchrony continued to press its digital strategy, reporting an 18% increase in total digital visits and a 17% rise in sales during 2025 following enhancements to its marketplace, website and mobile app. The company also more than doubled unique provisioned accounts in digital wallets.

Executives highlighted investments in artificial intelligence (AI) search, mobile wallet integration and platform connectivity as key drivers of engagement, positioning Synchrony to surface financing options earlier in the shopping journey, from product pages to digital carts.

Walmart is already reshaping Synchrony’s growth profile. Doubles described the retailer as the company’s fastest-growing program ever, following its September launch, and said it represents a meaningful contributor to Synchrony’s mid-single-digit receivables growth outlook for 2026.

Chief Financial Officer Brian Wenzel said these large programs, combined with improving core volumes, help underpin management’s expectation for accelerating loan growth in the back half of 2026.

Credit Card Caps Draw Pushback

Management was direct in opposing proposed 10% APR caps. Doubles said price controls would not make credit more affordable, arguing instead that they would reduce availability.

“A cap would require issuers to significantly reduce the amount of credit they’re able to provide. And that disproportionately impacts the consumers at the lower income level,” Doubles said.

He noted that Synchrony supports roughly 400,000 small and mid-sized businesses, in some cases accounting for more than 40% of their sales, and warned that caps would disrupt merchant economics alongside consumer access to credit.

Wenzel said Synchrony expects mid-single-digit receivables growth in 2026, with momentum building as new programs mature. Net charge-offs have returned to the company’s long-term target range of 5.5% to 6%, while delinquency rates improved.