Founded in 1932, Synchrony Financial, the parent company of Synchrony Bank, has been serving as a financial services institution in the retail world for several decades. While Synchrony Bank does offer a variety of bank products, including high-yield savings, money market accounts, and certificates of deposit, the company does not currently offer direct-to-consumer financing like personal loans, automobile loans, home mortgage lending or Synchrony credit cards.
However, many consumers have likely heard of and become familiar with Synchrony indirectly. This is because Synchrony Financial is one of the largest providers of retail credit cards that help users in with credit needs in all major industries. Here’s how the financing options through Synchrony Financial work for consumers.
How Financing with Synchrony Bank Works
When customers of certain retailers or small businesses need access to financing, Synchrony Financial is there to lend a necessary hand. The company offers a private-label, closed-loop financing option to some businesses that want to offer credit card financing to customers. The financial services company also offer open-loop card options for certain large retailers. With a closed-loop, private label card underwritten by Synchrony, customers who are approved for a new credit card through a retailer’s program can only use the card at that specific store. Open-loop cards available on both the Visa and Mastercard networks allow customers to use the card anywhere Visa or Mastercard are accepted.
Customers apply for a retailer credit card directly through Synchrony, typically at the register of a store, online, or over the phone. In a matter of minutes, Synchrony is able to approve or decline a new credit card application. Like most retailer credit cards, Synchrony limits the available credit on a new card, usually offering no more than $500 or $1,000 initially. Many consumers, even those with less than perfect credit, can get a Synchrony retailer credit card, but an application is required.
The application requires you to provide your full name, home address, contact information, and date of birth. You’ll also need to provide your social security number, your income and employment information, and your driver’s license. Once your application is approved, purchases can be made immediately. You also receive a physical credit card in the mail within a few weeks.
The Most Popular Synchrony Credit Cards
With the help of Synchrony Financial, several major retailers as well as small businesses can offer easy and fast access to credit for their customers. Here’s a shortlist of the most popular Synchrony Financial credit card options available today:
Synchrony CareCredit Credit Card – this credit card is available for consumers looking for financing options for healthcare procedures, including veterinary expenses. Typically, the CareCredit card will offer promotional financing for qualified customers, such as no interest if the balance is paid in full in six, 12, or 18 months.
Banana Republic Credit Card – this card option is a smart choice for Banana Republic frequent shoppers, as well as those who shop at its affiliated retailers including Gap, Old Navy, Piperlime, and Athleta. The card can be used only at these brand retailers. Cardmembers earn five points for every dollar spent which turns into $5 reward certificates every 500 points.
Walmart Mastercard – this Synchrony Financial credit card option is an open-loop co-branded card, meaning even though it says Walmart, it can be used anywhere Mastercard is accepted. Cardmembers earn 3% on Walmart purchases, 2% on Murphy USA and Walmart fuel purchases, and 1% on all other purchases. Rewards can only be redeemed for a statement credit.
Considerations for Store and Retailer Cards
While Synchrony Financial makes it incredibly easy to get a retailer credit card at your favorite store, either online or in-person, retail credit cards aren’t always the best choice. First, the majority of retail credit cards have double-digit interest rates, starting at 24%. Even though there are often promotional APR offers with co-branded cards from Synchrony, any remaining balance that isn’t paid in full by the time that period ends results in a big interest charge.
Cardmembers with retailer credit cards from Synchrony and its partners do not typically pay an annual fee, but there may be other charges. Foreign transaction fees are standard, as are late payment fees, and over the limit penalties just like the majority of other credit card. However, Synchrony keeps the maximum credit line limit offered to customers pretty low, even if your credit is in good shape.
The combination of drawbacks should be weighed against the card rewards, if any, offered from a co-branded Synchrony credit card from your go-to stores. In many cases, a traditional cash-back rewards credit card or travel credit card is going to be a better option.
