Dive Brief:
- Capital One and retail giant Walmart said in a joint press release Friday that they’re parting ways.
- The partners didn’t say when their break-up would affect the services provided to credit card holders under the rewards program they created in 2019. “Until informed otherwise, cardholders can also continue to use their Capital One Walmart Rewards,” wherever Mastercard is accepted, as well as the Walmart Rewards card for their Walmart purchases, the release said.
- “While Capital One and Walmart have ended their card partnership, nothing changes today for cardholders — cardholders can continue to earn and redeem rewards, and previously accrued rewards will retain their value,” the release said.
Dive Insight:
Walmart was given permission by a federal judge in March to end its credit card partnership with Capital One because of customer service issues, a federal judge ruled.
The agreement terms between the two “clearly dictate that Capital One’s repeated customer service failures entitled Walmart to invoke the Termination Right and terminate the parties’ ongoing partnership,” U.S. District Court Judge Katherine Polk Failla wrote in a decision.
Walmart sued Capital One in April 2023, seeking to end its credit card partnership with the McLean, Virginia-based lender. Walmart alleged Capital One repeatedly failed to meet several contractual obligations of the card partnership, including promptly issuing replacement cards to customers, as well as processing their payments and posting transactions to accounts in a timely manner.
The break-up also follows the announcement by Capital One this year that it would seek to acquire Discover. If completed, the deal would put Capital One ahead of JPMorgan Chase as the largest credit card issuer in the U.S.
