Debit card rewards – room for growth?
Considering the proliferation and variety of reward programmes available, it is surprising that debit card rewards are still so limited in their availability.
That is among the findings from Optimising Debit Card Programmes, a report by US financial services research company Synergistics.
The reports found that only three in ten debit card holders say that they have some type of reward, discount, or rebate associated with their debit card (see chart).
In the survey, debit card holders were presented with an extensive list of various types of rewards and rebates and asked if their debit card has any of them.
Coupons or reward points for discounts on merchandise or services and cash rebates are the top two types mentioned, each being indicated by about one in seven debit card holders. One-tenth cite travel rewards such as frequent-flyer points, points that can be redeemed for gifts in a catalogue, free travel accident insurance when reservations are made with the card, and points or rewards that can be combined with those earned using a credit card.
Less than one-tenth mention any of the other types of rewards, including charitable contributions, contributions to savings plans, discounts on banking services, gasoline discounts, and long-distance minutes. Overall, about three in ten say they have at least one of these types of rewards, discounts, or rebates associated with their debit card.
Genie Driskill, COO of Synergistics, commented: “Findings from our new study reveal that there is plenty of room for growth in the area of debit card reward programmes. Few consumers report having debit rewards currently. And when usage of various types of debit rewards are examined, no one type of reward stands out – the market is still wide open for a provider to step in and differentiate themselves from the crowd.
Debit card issuers must aggressively promote the availability of reward programmes and encourage participation. Challenges also exist as decoupled debit programs come into play.”