Samsung is fond of using cash rewards to drive Samsung Pay signups, offering consumers $25 to $100 in recent months for enrolling a payment card in the handset maker's mobile wallet. But that strategy is not a fit for all card issuers, according to the fine print in the latest Samsung Pay promotion.
In a new Samsung Pay promotion, consumers will get a $30 reward for enrolling a Visa, MasterCard or American Express card from among hundreds of participating U.S. banks—except Bank of America debit cards.
Observers noted it's the first time Samsung has excluded a specific issuer's general-purpose payment card from receiving a cash reward since the mobile wallet's launch last year, which has been supported by a series of similar promotions.
A Bank of America spokeswoman offered this explanation for why its debit card customers won't get an extra reward for enrolling those cards in Samsung Pay: "We currently don't share transaction history for debit cards, so Samsung can't track who qualifies [for the promotion]."
To be sure, Bank of America debit card customers can still enroll in Samsung Pay. But why is there no cash reward for doing so?
The move, though buried in fine print, may suggest a big shift in issuers' mobile-wallet strategies, experts say.
Bank of America isn't eager to encourage mass enrollment of its less-profitable debit cards in third-party mobile wallets like Samsung Pay, Apple Pay and Android Pay, suggested Eric Grover, a consultant with Minden, Nev.-based Intrepid Ventures.
"It's obvious that Bank of America's main goal here is to encourage mobile-wallet activity on credit cards, which have better economics than debit cards in the post-Durbin Amendment era," Grover said.
Though it's still the early innings for mobile wallet development, Grover said banks aren't guaranteed to continue broadly supporting third-party wallets as they have been doing. Bank of America's move to exclude debit cards from Samsung Pay's latest promotion could be a hint of what's to come, he says.
"Many banks are wary of seeing their card brands vanish into Samsung Pay, Apple Pay and Android Pay and as time goes by, I believe they'll want to renegotiate the terms of participating in these third-party wallets," he said.
Bank of America has little to gain by providing extra encouragement for its debit card customers to lock the card into their Samsung Pay wallets, said payments consultant Richard Crone.
"You're seeing a very tactical move here by Bank of America to only encourage distribution of its credit card products through Samsung Pay's promotion," Crone said.
The growing power of transaction data in mobile payments also could have something to do with Bank of America debit cards being excluded from the latest Samsung Pay promotion, Crone said.
"Mobile payments technology is unlocking a vast trove of transaction data that's highly valuable to the party that enrolls the cardholder," Crone said. "The data feeds are huge and as mobile payments players try to figure out how to deliver value from that data, we're going to see changes in who pays whom to enroll cards."
In Samsung Pay's latest promotion, consumers who enroll a card with one of Samsung's newer handsets receive a $30 reward good at Best Buy, eBay, Whole Foods, Nike or Regal Cinema. Private label credit cards also are excluded. The promotion runs March 11-31, 2016.