The news: Samsung is reportedly in advanced talks with Barclays to develop a co-branded Visa credit card, per the Wall Street Journal.

The card’s cash-back rewards would funnel back into cardholders’ Samsung accounts to encourage spending on Samsung products and services.

Why this matters: With a co-brand card, Samsung can make a push to capture the second-largest group of US smartphone users—128.7 million—in the Samsung Wallet. 

Samsung users would be able to tap to pay from their Galaxy smartphones, and The Journal reports Samsung is also considering pairing the card with connected high-yield savings accounts, prepaid digital accounts, and buy now, pay later (BNPL) installments. This enables Samsung to profit more from consumers’ hardware upgrades financed through its card—and secure more everyday spend. 

Bite of the apple: Samsung’s credit card comes when its chief competitor’s product is in flux. As the Apple Card searches for a new home post-Goldman Sachs, Barclays offers Samsung a proven issuer with a bench of successful co-branded products, potentially letting Samsung benefit from a clean launch of its improved financial suite compared with its rival’s fumble.

This also represents a needed win for Barclays, which recently lost the remainder of American Airlines’ co-brand portfolio as well as Lufthansa and Choice Hotels.

Our take: To accelerate users’ adoption of the card, tech companies with payment ambitions should build a flywheel to lock in new consumer spending patterns. 

By centering rewards and device upgrades to the same credit card and wallet, consumers can find both the products, services, and financing they desire all in one place.