DES MOINES, Iowa-Sara Petty, VP of strategic initiatives for The Members Group, said raising point plateaus is just one way to ensure rewards programs continue to create value for issuers. Because rewards are such good differentiators, she said most issuers are ramping up their rewards programs.
"We are seeing a big increase in debit rewards," she said. "Merchant-funded rewards are a trend. Merchants reduce the expense on the redemption side. I think we will see an increase of merchant-funded rewards on both credit and debit. With debit cards there haven't been as many rewards program because ROI is different. With debit most income is through interchange. Credit cards can bring income through interchange, interest rates and fees."
The Members Group believes rewards programs will be key, Petty added. "There will be issuers with different interest rates and fee structures, but with all the regulations it will be difficult to differentiate on that side."
