Klarna debuted a two-tiered membership program, per a press release. larna’s second stab at a rewards membership program may prove more fruitful. This places the onus on competitors like Affirm, Sezzle, Cash App Afterpay, and PayPal to respond in kind. Offering better rewards is one way to stand out: PayPal’s Pay Later offered an untouchable 5% back during a holiday promotional period. While platforms could mimic Klarna’s membership program, BNPL providers could also expand promotional 0% interest windows, like Affirm’s latest offer, to sway young consumers who view installment loans as safer than revolving credit.

PayPal will make its Pay Monthly installment loans available in-store in the US ahead of the holiday season. For competing BNPL providers, PayPal’s rewards structure now far outstrips what most of them offer. Competitors should consider more strategic partnerships with desirable Gen Z and millennial brands to strike directly at the root of where young consumers are shopping, and cut deals with those merchants for more favorable cash back rewards.

Along with expanded access to Pay with Venmo and a buzzy ad campaign, Venmo is trying to reach key demographics.

Whose credit card business does it hope to woo?

These can fuel more frequent debit card usage, helping these cards better compete against credit card programs