The Power of Payment Cards in Loyalty Programs

2 min read
December 14, 2023 at 3:43 PM

Payment cards are credit, debit, charge, and prepaid cards issued by banks or other institutions. They are one of the most widely used forms of credit around the world, allowing users to purchase goods and/or services to incur debt to be repaid later. Their flexibility and ease of use make them a prime candidate to incorporate into your loyalty program – but how can they fit into the big picture?

How Can Payment Cards Fit In with Your Loyalty Program?

Rewards are an enticing benefit of any loyalty program, and payment cards can elevate them to another level. Beyond the standard reward options, they offer the ability to redeem points or – most importantly – cash back. This presents a creative opportunity for customers to redeem their rewards in unique ways and stretch their budget or treat themselves thanks to the loyalty to your brand.

There are many types of payment card rewards that can be offered through loyalty programs. To explore just a few:

  • Cash back: a percentage of purchases are earned back as cash rewards.
  • Points: points for purchases can be redeemed for rewards such as discounts or coupons.
  • Travel rewards: frequent fliers can earn and use their rewards to redeem hotel stays, car rentals, and more.
  • Miles: like travel rewards, miles enable users to redeem airline flights and upgrades.
  • Gift cards: points from purchases can be used to redeem gift cards from retailers.
  • Exclusive offers and experiences: points from purchases can be used to obtain access to exclusive discounts, promotions, and events.

Payment Cards Can Be the Gateway to an Extraordinarily Successful Reward Program

Payment cards are not going away – but the way customers use them is changing. Swiping is no longer the only option, and their ease of use via tap to pay and mobile wallets make them even more convenient than before. This is why they are worth a serious thought to incorporate into a loyalty program.

Exclusive and virtual cards offer a unique opportunity to leverage rewards into customer data and preferences that can be analyzed via data analytics and machine learning algorithms. Cards offer retailers insight into customer behavior that can be used to personalize offers and improve segmentation for campaigns.

It is all about the experience: customers expect brands to go above and beyond. Payment cards that enable customers to have an experience – or donate to important socially and environmentally conscious causes – provide a unique opportunity to make a brand stand out. All with the added value of customer retention and loyalty.

Case Study: Chase Ultimate Rewards

The benefits for consumers are clear – but what about the benefits for your brand? Let us explore a popular case study and see how a company can utilize these loyalty programs.

Chase offers a versatile reward program that enables payment card users to earn points that can be redeemed for travel, cash back, gift cards, or merchandise. It offers an elevated level of flexibility by enabling users to earn bonus points for specific spending categories and a flexible point redemption system.

They have partnered with popular companies, such as Amazon, PayPal, Apple, and many other brands to enable their loyalty program members to have easy access to redeem their rewards. Flexibility and choice make Chase a valuable option when selecting a payment card – particularly when there is already so much competition on the market.

Most importantly – the rewards can be memorable. A meal shared with family and friends. A vacation or honeymoon with a partner. It is a moment to relax and enjoy life, and it is even sweeter when it is presented as a reward. Customers will remember these moments and they will remember the brand that made it possible, too.