U.S. Bank and Mastercard Debut BNPL Alternative ‘Split Card’

U.S. Bank has debuted a credit card that converts purchases into monthly payment plans.

The bank’s Split World Mastercard, announced Wednesday (Nov. 5), is designed to serve as an alternative to buy now, pay later (BNPL) plans.

According to a news release, the card can be used for in-store or online purchases anywhere Mastercard is accepted, with every purchase automatically split into a three-month payment plan with no interest or annual fee.

Cardholders can opt to extend payment plans to six or 12 months for bigger purchases – $100 or more – for a “small, fixed monthly plan fee,” the release added.

“Split Card meets the diverse needs of today’s consumers who are seeking easy and transparent ways to fund purchases of all sizes,” said Chris Roncari, head of product and experience for consumer and small business payments at U.S. Bank.

“Split Card has elements of a typical card but is far from a typical credit card with its budgeting control and interest-free option. We expect Split Card will be a top choice for Gen Z consumers, and many others, who desire the broad scale usability, simplicity, and protections of a credit card but also need the financial consistency of equal monthly payments.”

Research by PYMNTS Intelligence has logged the popularity of card installment payments among younger consumers.

That data showed that 14%, of both millennial and Gen Z consumers reported utilizing store card and credit card installments over three months through May 22 of this year.

“This figure indicates younger consumers’ comfort and preference for the structured payment method, signaling their early and strong adoption of these flexible credit options,” PYMNTS wrote in the report “Split Shift: How Card Installments Are Reshaping the Pay Later Landscape.”

“It’s no longer just about revolving credit, meaning using a general-purpose credit card in the traditional way. It’s about using those cards to segment larger purchases into manageable, interest-free or low-interest installments, just like one does with BNPL products.”

Credit card split payments, that report added, have gained a specific foothold. They’re used more often than BNPL for specific goods and services, such as travel, vacations, experiences like concerts, and groceries, the last of which had been a traditional BNPL stronghold.

The research also logged the growing popularity of private label cards — or store cards — among younger consumers. Over a two-year period, Gen Z usage of private label installments grew nearly 20%, while millennials recorded a more modest growth of 0.8% annually. By contrast, Gen X usage dropped slightly.

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