Payments giant PayPal has agreed to sell $6.8bn in receivables, including $5.8bn in US consumer credit receivables, to Synchrony Financial.

The deal also includes interest receivables of around $1bn held by PayPal customers. The transaction is expected to be completed by the third quarter of 2018, subject to regulatory approval.

At the same time, PayPal will also expand its partnership with Synchrony Bank in the US for another 10 years, making Synchrony the exclusive issuer of the PayPal Credit online consumer financing programme. Synchrony Bank has been associated with PayPal since 2004.

PayPal president and CEO Dan Schulman said: “Our expanded relationship with Synchrony Financial will free up cash currently used to fund consumer credit receivables for other uses, while accelerating our ability to deliver engaging credit and payments experiences for our customers.”

Synchrony Financial president and CEO Margaret Keane added: “This collaboration builds on a key partner relationship in the rapidly growing digital payments space and expands our capabilities within the merchant environment.”

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