One of the chronic flaws of retailer-driven loyalty programs is that often it’s hard to actually get the rewards. Consumers complain that it takes too long or steps required are too cumbersome to conveniently redeem their points.
Jacksonville, Fla.-based processor Fidelity National Information Services (FIS) is aiming to find a way around that problem by partnering with the terminal maker Verifone to enable consumers to pay with loyalty points from participating merchants' payment cards.
Verifone has developed a cloud-based app that enables consumers to apply rewards points earned with merchants participating in FIS’ newest loyalty program at the point of sale, the companies said in a Jan. 11 press release.
The new Verifone Points Redemption app is powered by Modo’s COIN-operated Digital Payments Hub and links to the FIS Premium Payback Network, a merchant loyalty program FIS introduced last fall after a pilot with 7,000 U.S. BP stations. Consumers redeemed rewards points for 50 cents off each gallon of gas (up to 20 gallons).
When a shopper presents a loyalty-linked card at a participating merchant, Verifone’s terminal notifies them when enough points are available to pay for their items. Consumers see a yes or no option for whether they want to apply earned points to that purchase, eliminating the need for vouchers or cashing out value to a gift card, the companies said in the release.
“Today’s consumers have been digitally empowered and expect tomorrow’s payment and rewards capabilities today,” said Bruce Lowthers, executive vice president with FIS Global Retail Payments, in the release. “The single integration point to brick-and-mortar retailers uniquely helps loyalty programs increase member touchpoints, while our relationship with Verifone expands the reach to bring scalable loyalty points redemption to many more consumers.”
Verifone and FIS research suggests nearly $16 billion in loyalty points are left unused each year because of the friction involved in redeeming rewards, according to the release.
“We are helping merchants and consumers realize the value of loyalty programs by bringing points redemption to the shopping experience right where it counts—at the checkout,” said Glen Robson, executive vice president and head of Verifone Solutions, in the release.
During the BP pilot, participating gas stations noted an increase in purchases using BP payment cards as well as loyalty program participation, FIS said in an earlier release.
The FIS Premium Payback Network supports loyalty points redemption at thousands of gas stations nationwide for 8.5 million consumers, FIS and Verifone said in this week’s news release.