OPPORTUNITY ALERT: Debit Rewards Driving Higher Card Usage for Banks
More financial institutions are offering debit rewards programs to drive higher card usage.
That’s according to the “2016 Annual U.S. Debit Rewards Review With U.K. Comparison” recently released by the Mercator Advisory Group.*
Mercator Advisory Group’s annual survey of the largest 50 banks and credit unions, this year also including online-only banks, reveals that a substantial number of institutions from all three groups are leveraging debit card rewards, with promising results.
Specifically, Mercator found that 56 percent of financial institutions are offering a reward that involves debit-card usage. Think about that: a bit less than half of those surveyed DO NOT offer such programs, leaving plenty of room for competitors to gain a competitive advantage.
Are you offering a debit rewards program?
Are you offsetting those costs with a “merchant-funded” rewards program?
How about your competitors?
Young Adult Debit Card Users “Like” Rewards
Why should you consider adding a debit rewards program to your portfolio?
In an earlier survey of U.S. adults, Mercator found that “70% of debit card users with debit rewards and 85% of young adult debit card users who have debit card rewards are motivated to use their cards more often because of the rewards.”†
In the highly competitive pursuit to become the top-of-wallet card, especially among key demographics like young adults, debit rewards are proving to drive higher usage.
Not only that, certain offerings can help drive down debit program costs. Among its findings in 2016 survey of issuing institutions, Mercator found that merchant-funded debit rewards programs — where the merchants provide the rewards (to help them drive traffic and relationships), are growing among banks and credit unions, and that helps reduce costs of providing debit rewards.
No one knows your market better than you, so you’ll know what will work and what won’t. But if you are not offering some Loyalty and Rewards Solutions with your debit card, it’s worth a look.
Want to learn how you can add loyalty and rewards solutions to drive customer satisfaction and generate revenue? Request a free briefing with one of our Loyalty & Rewards Specialists.
* Source: 2016 Annual U.S. Debit Rewards Review With U.K. Comparison,” Mercator Advisory Group, February 2016
† Source: Mercator Advisory Group CustomerMonitor Survey Series, Mercator Advisory Group, 2015