Programs that reward consumers when they use their debit cards have been largely considered a likely major casualty of the Durbin Amendment's cap on debit interchange.

But a recent study conducted by business research firm Mintel Compermedia found that 47% of consumers surveyed who participate in a debit rewards program have never actually redeemed their rewards 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,” says Susan Wolfe, vice president of financial services at Mintel Comperemedia in Chicago.

“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,” Wolfe said.

The firm segmented survey respondents into three groups: heavy (redeem about once a month), medium (redeem every few to every six months) and light (redeem once a year) redeemers. Thirty-six percent of heavy redeemers and 30% of medium redeemers, compared to 55% of light redeemers, would continue to use their debit card the same way if their bank eliminated their debit rewards program — further suggesting that debit rewards programs are not a strong incentive to stick with a particular banking institution.

But Wolfe suggested that the data does not show that debit rewards programs are going away, rather that they are likely to be absorbed into other loyalty programs.

“Overall, rewards aren't going away, and many banks will continue to offer and promote these programs,” she 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.”

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Study Questions Importance of Debit Rewards

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