More banks should consider combining their debit and credit card rewards programs, which could better help them stave off customer attrition, according to the results of a survey released Tuesday by Synergistics Research Corp.
In a national Internet survey of 1,000 adult consumers conducted earlier this year, the Atlanta consulting and research firm found that about seven in 10 households use both debit and credit rewards programs. About six in 10 of those users said they view programs that allow them to combine rewards from both card types as valuable, and a fifth of them said they are "very" valuable.
Citigroup Inc. and Wells Fargo & Co. are among the more notable examples of banks that have enabled customers to combine rewards from the different card products, according to the report. "I think there are tentative efforts by other large financial providers in this country to try to come up with a model that makes sense on the relationship rewards side," Bill McCracken, Synergistics' chief executive, said in an interview Tuesday.
However, there are often technological and financial barriers to developing a system that makes combining rewards seamless for banks and their customers, he said. Banks struggle with determining how various operational units will fund a rewards program that spans multiple product lines.
Also, "many banks do not have systems that talk to one another across the different bank divisions," McCracken said. "The credit card group's system is often times unique to the credit card group and it does not interact with the retail bank platform, which is where the checking account balances would be. That may or may not interact with the savings side, where CD balances are kept, and that may or may not interact with the debit card platform."
"If you can't get those systems to talk to one another it would be very difficult to have relationship rewards programs," he said.