Wells Fargo is Cutting Ties With Bilt as Credit Card Partnership Fails to Deliver Profits

Wells Fargo is ending its partnership with Bilt ahead of schedule, as profits failed to materialize from the companies’ strategy of enabling cardholders to earn rewards when they pay their rent with the Bilt card, according to a recent report.

The decision by Wells Fargo, which is one of the largest banks in the U.S. in terms of asset size, underscores that, for issuers, having a timely exit plan for a failing card strategy is important. 

Nobody wants to think about the end of a business relationship when it’s just getting off the ground. But an issuer that has a blueprint for what to do when things don’t go according to its initial forecasts may be better able to weather tough times.

In his iconic song “The Gambler,” Kenny Rogers advised that, in addition to knowing when to hold on to the cards you’re dealt, you also need to know when to walk away. Wells Fargo decided that walking away from an unprofitable partnership is better for its future financial prospects than trying to fix a program that isn’t profitable.

The union between the two companies started strong in 2022. People activated more than 1 million accounts for the card in the year and a half following its release.

Cardholders activated more than 1 million accounts in the 18 months following the card’s launch.

The Wells Fargo and Bilt co-branded credit card caught the attention of cardholders for its unique structure. The card offered rewards to cardholders for something many of them are doing every month anyway: paying their rent.

“Rent is the single largest expense for the vast majority of American renters, yet it’s never been a tool that helps consumers confidently enter the housing market,” Dan Dougherty, then the Head of Partnerships and Branch Cards at Wells Fargo, said in a press release announcing the partnership between the two companies.

“As the new issuer of the Bilt Mastercard, Wells Fargo can now help renters with the card take their biggest expense and turn it into a rewarding experience, including helping them build a path to homeownership,” Dougherty added. 

The card seemed destined for success based on the large pool of potential customers that stood to gain from its features. Renters make up more than 44 million households in the U.S. 

And nearly half of renters in the U.S. are under the age of 30. Taking cues from Dougherty’s remarks, Wells Fargo likely saw the card as a way to enter the wallets of young renters.

The bank envisioned a long relationship with cardholders and the ability to offer them more products, including mortgages, as their financial needs expanded. But that’s not the way things turned out.

Instead, the product ended up costing Wells Fargo up to $10 million per month, according to The Wall Street Journal. The bank had hoped that customers would revolve their balances, allowing the company to pick up interest income from cardholders who missed paying their balances in full each month.

But that didn’t happen, and Wells Fargo has since pivoted its card strategy to shift away from co-branding initiatives to offer more credit cards without the help of partners. 

Close observers of the relationship between Wells Fargo and Bilt may have guessed that it would end soon, but they may not have thought it would wrap up in 2025.

The contract between Wells Fargo and Bilt was to run through 2029. The bank previously indicated it did not intend to extend the deal past that year unless it became more profitable. 

When things weren’t going according to plan, Wells Fargo preached patience.

“As will all new card launches, it takes multiple years for the initial launch to pay off,” a Wells Fargo spokesperson said last year. 

But apparently the payoff wasn’t coming fast enough for the bank. The Wall Street Journal details that Wells Fargo assumed that nearly two-thirds of spend on the card would come from non-rent expenses and yield interchange income. 

The company also projected that somewhere between 50% and 75% of balances on the cards would roll over from month to month. But neither of those projections proved true. And that led Wells Fargo to move to terminate the partnership less than halfway through its expected course.

The miscalculations by Wells Fargo in estimating the profitability of its offering with Bilt highlights the role that data analytics can play in determining growth strategies. Issuers should use all the relevant analytics they can access to plot future revenues. 

But they should keep in mind that even the best data scientists can’t predict future revenues with complete accuracy all the time.

The credit card industry may view the end of the relationship between Wells Fargo and Bilt as a black eye for both companies. But Bilt has taken steps to control the narrative by attempting to shift the public’s focus to the company’s still-bright future prospects.

In a blog post, Bilt announced it has raised new funds, and the company’s value is now $10.75 billion. Further, the post revealed that Bilt will process more than $100 billion in housing spend by the close of 2025 and plans to exceed $1 billion in revenue in 2026’s first quarter.

But it was the company’s news on the credit card front that most caught our attention. 

Bilt said it has received “incredible feedback from tens of thousands” of its customers regarding what they want to see from Bilt cards in the near future. 

“Based on that feedback, we have been developing new cards that deliver the depth and breadth of product experience you all have asked for,” the company said.

The company is developing Bilt Card 2.0 to align with what its customers seek. The new program is the result of Bilt’s partnership with financial technology outfit Cardless. 

Bilt is rolling out a new roster of credit cards in early 2026 to align with customer feedback.

Under the partnership, Bilt will unveil a new card lineup that features a no-fee card alongside two premium cards. One premium card will carry an annual fee of $95 while the other is priced at $495 per year.

Bilt said the new card lineup rolls out in February 2026. Those who’ve opened a card under the Wells Fargo and Bilt partnership will see their card move to another platform when the new cards launch. We’ll be keeping an eye out for further details about the new Bilt card lineup.

The Wells Fargo and Bilt story shows that two successful companies can make a wrong turn on their course to building an innovative card program. But a wrong turn or two doesn’t need to completely derail a company’s future.

Issuers that have entered into an alliance that no longer benefits them may be able to end the partnership, minimizing losses before they mount to unmanageable levels.