Banks that have chosen to eliminate debit rewards programs in order to recoup revenue lost from new federal regulations may not lose out on customer loyalty, according to a new survey.
Mintel Comperemedia surveyed consumers on their debit rewards behaviors and attitudes and found that 47 percent of respondents who participate in a debit card rewards program have yet to even redeem their points.
"Obviously, a couple different types of people fall into the group who never redeem debit rewards points — some are saving up for something bigger, while others simply haven't accumulated enough points," Susan Wolfe, the vice president of financial services at Mintel Comperemedia, said. "However, a number of people participate in a debit rewards program because it's so easy to sign up but never use the program again. If so, it indicates that the rewards program isn't working as a way to instill loyalty."
The survey broke respondents into three groups: heavy cardholders who redeem points about once a month, medium cardholders who redeem points up to every six months and light cardholders who redeem points only once a year. According to the survey, 36 percent of heavy redeemers and 30 percent of medium redeemers, compared to the 55 percent of light redeemers, said they would not change the way they use their debit card if their bank eliminated the debit rewards program.
"Overall, rewards aren't going away, and many banks will continue to offer and promote these programs," Wolfe said. "But we will see a shift in that rewards are offered as a benefit to different levels of customers and in that way, they will become part of an overall loyalty program — rather than just a debit rewards program."
The survey also included an assessment of consumers’ willingness to pay for debit rewards program and found that 36 percent of heavy redeemers will pay as much as $4 a month to retain their program.