The new options, which become available Sept. 24 and use Mastercard Inc.’s network, offer 5% cash back for purchases made at Walmart’s website, including groceries.

(Bloomberg)—In a sign of how much Walmart Inc. is betting on ecommerce, the retailer’s revamped credit-card program with Capital One Financial Corp. offers better rewards for online shopping and checking out with its mobile app.

The new options, which become available Sept. 24 and use Mastercard Inc.’s network, offer 5% cash back for purchases made at Walmart’s website, including groceries. At the chain’s physical stores, shoppers only get that rate for a year and have to check out with Walmart Pay at the cashier. Otherwise, store customers get 2% back.

With the new cards, Walmart is narrowing the gap with big competitors that have programs with more lucrative rewards. For example, Target Corp. provides 5% back on both online and in-store purchases. Retailers are boosting loyalty offerings to hold onto shoppers who now have many more options online—starting with Amazon.com Inc. Walmart has been pouring money into digital in an attempt to transform a business built on thousands of bricks-and-mortar locations.

“We really recognized the need to fully integrate a digital-first experience in a payment program,” said Daniel Eckert, senior vice president of Walmart services and digital acceleration, on a call with reporters. “These are the richest rewards we’ve ever offered our customers.”

Walmart signaled changes were coming last year when it severed ties with Synchrony Financial in an acrimonious divorce and signed a deal with Capital One. Cards under the Synchrony partnership offered 3% cashback on online orders and 1% for in-store purchases.

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The Bentonville, Arkansas-based retailer declined to provide specifics on current cardholders or how much revenue comes from them. One way to judge the size of the business is that Capital One said last year that it would buy $9 billion in receivables from Synchrony for an undisclosed sum.

Walmart, which faced criticism for not doing enough to promote its cards, did say that it’s planning a robust marketing effort, both in stores and through national media, to promote the roll-out over the next few weeks.

Capital One has hinted that Walmart’s aspirations in banking could go deeper than expanding their card offerings. The retailer has a partnership with the online lender Affirm and it also offers a popular prepaid card with Green Dot Corp.

“They are very committed to building deeper financial relationships and especially with credit cards as the tip of the spear for those enduring relationships,” Capital One CEO Richard Fairbank told investors in June.

Walmart is No. 3 in the Internet Retailer 2019 Top 500.

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