The online lender, challenger bank and payments provider Upgrade is adding a shopping component to its app and website that will bring it closer to having a “super app."
Upgrade Shopping, which launches Wednesday, is a new area of the Upgrade app and site that gives users 5% to 10% cash-back rewards at more than 20,000 retailers when using the Upgrade Card. It was created through a partnership between Upgrade and Cardlytics, whose advertising platform runs in banks' digital channels.
“Every player in the fintech and neobank world is racing to build a super app, where we move upstream in the user’s decision-making process and encourage users to start their shopping experience from our own app,” said Renaud Laplanche, CEO of San Francisco-based Upgrade. “We think we’re ahead of the pack.”
A super app is a mobile application that provides multiple services including banking, payments, e-commerce and in some cases communication. Examples include Tencent's WeChat and Ant Group's Alipay in China.
Upgrade does not offer all this yet. At this point, it doesn’t have online shopping, but it does present offers from retailers. It lets users search for products by category, it displays a map that shows where physical stores are relative to the user's location and it offers links to retailers’ online shopping sites. The actual shopping — selecting specific products and checking out — happens on the retailer’s website, app or physical store.
“It’s certainly possible we will bring that part in-house at some point,” Laplanche said.
Laplanche sees the idea of a super app as a journey rather than a destination.
“I think that journey is about gradually becoming more useful to more people, and offering a broader set of products and services beyond financial services,” he said. “Upgrade users so far get their payment and credit products from Upgrade, and use these products to shop elsewhere. Over time, we believe we can capture more of that shopping experience.”
Upgrade’s merchant partners include H&M (for which it provides 6% cash back in store and online), Adidas (5% online) and Shake Shack (10% online).
Upgrade Card users can access Upgrade Shopping rewards by using their card in store at participating merchants, or by clicking on the “Shop” button of the Upgrade app or website to shop online. Upgrade Shopping rewards are additive to Upgrade Card’s existing cash-back rewards, so for instance, an Elite Upgrade Card user shopping at H&M through Upgrade Shopping would earn 6% back on top of the 2.2% Upgrade Card rewards for a total of 8.2% cashback rewards on the purchase price.
Upgrade has provided more than $12 billion in credit to consumers through cards and loans since its inception in 2017. Its bank partners for loans, credit lines and banking services are Cross River Bank in Fort Lee, New Jersey, and Blue Ridge Bank in Luray, Virginia. The Upgrade Card is issued by Sutton Bank in Attica, Ohio.
