Signature Systems LLC says its Swift Exchange platform can address a pain point for rewards wallets: rewards are easier for consumers to earn than to spend.

Signature plans to test its system in the fourth quarter and to launch it in early 2013, the company's CEO, Richard Postrel, tells PaymentsSource. The system aggregates loyalty program points and miles into one spendable currency.

This process should make spending rewards easier for consumers, while introducing merchants to new markets and lowering operational costs for participants, he says.

"The higher the rate of redemption, the higher the customer satisfaction," Postrel says.

Using a mobile application, a consumer can spend rewards points by displaying quick-response codes on the phone's screen, Postrel says.

Merchants benefit by working together to target groups of consumers (newlyweds, for example). This cooperation should prompt more spending across all merchants, Postrel says.

Issuers benefit because Swift Exchange eases the management of rewards programs, he says. Issuers retain control of their brands and rewards value and partnerships.

Swift Exchange benefits by taking 2.5% of each transaction from the issuer and merchant, he says.

This launch will be watched closely in the highly competitive world of rewards programs, Mercator Advisory Group senior analyst Ben Jackson tells PaymentsSource.

"The value of this does come in ease of redemption," Jackson says. "The points have to be easy to redeem and easy to access and track in order to make that loyalty program worthwhile to the shopper. If they can do that they'll offer a strong value."

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