DEERFIELD — Walgreens wants to be in your wallet.
The Deerfield-based drugstore chain announced Wednesday it is launching its own Walgreens-branded credit cards later this year, expanding into financial services as its core business struggles during the pandemic.
The Walgreens cards, which will be issued by Synchrony on the Mastercard network, will include a branded credit card offering cash rewards tied to the new myWalgreens customer loyalty program.
The cards will also offer benefits at other retailers and service providers, including accelerated rewards when shopping in the health and wellness category, the company said.
Walgreens also plans to roll out a pre-paid debit card.
Walgreens president John Standley said in a news release the company plans to introduce more payment initiatives “in the near future” as it looks to create new revenue streams.
The move into financial services comes amid broader changes at Walgreens Boots Alliance, which last week reported a $308 million loss in its fiscal first quarter as the drugstore giant continues to lose business during the COVID-19 pandemic.
Walgreens’ first-quarter loss was tied to a charge for the announced sale last week of its pharmaceutical wholesale business to AmerisourceBergen. The $6.5 billion cash and stock deal is expected to close in September.
Walgreens has seen a dramatic drop in store traffic and pharmacy volume, with stay-at-home orders adversely affecting retail sales at its 9,000 locations in the U.S., and thousands more worldwide.
The company said last week it expects to see “higher adverse impacts” from the resurgence of COVID-19 in the second quarter, including a weaker cold and flu season due in part to ongoing social distancing measures.
Store traffic may pick up in the months ahead as Walgreens and rival CVS Health are expected to play a major role in administering COVID-19 vaccines as they become more widely available.
“Walgreens will receive an allotment of vaccines from the state, which we will make available by appointment in select locations to the eligible populations,” Walgreens spokesman Phil Caruso said Wednesday.
Beyond the expansion into credit cards, Walgreens has been evolving its business model by offering more options for customers to pick up or receive their purchases. It has also sought to boost store traffic by shifting its retail focus to emphasize its beauty products.
In July, Walgreens announced CEO Stefano Pessina would step down after five years at the helm of the drugstore chain. The search for his successor is ongoing, the company said Wednesday.
An Italian-born billionaire, Pessina was named CEO in 2015 after Walgreens completed its acquisition of Alliance Boots, a Switzerland-based pharmacy retailer. Pessina had been executive chairman of Alliance Boots.
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