Making the most of fintech as a travel and lifestyle rewards program

Fintechs have been disrupting as well as dis/ intermediating every step in the credit card value chain. It is imperative to understand how issuance, activation/ usage, experience and acceptance is evolving, writes Ai’s Ritesh Gupta


No country can match the scale of digital payments processed by non-banks in China, but other Asian countries, too, are making steady progress on this count. And this along with other areas in which financial technology (fintech) is foraying into the financial services arena is forcing co-brand and loyalty specialists to delve deep into the situation.

“We have had a deep look at how fintech is disrupting credit cards and therefore our co-brand cards. How should we, rather than fighting that, participate in the entire ecosystem and boost our customer value proposition,” shared Vikas Chandak, SVP and Head of Strategic Businesses, Financial Products, Partnerships & Alliances, Intermiles during the recently held Ai’s Co-brand & Travel Reward Cards Virtual Conference 2020.


Chandak pointed out that impact of the financial technology varies across different regions. And Asia remains a hub for innovative offerings, spanning across payments, investment products and overall finance management at this juncture. For instance, new credit cards are designed to put customers in control of their borrowing.  “We are seeing a tremendous change in how the Indian market responds to these innovations,” said Mumbai-based Chandak.

Referring to some of the elements that pave way for innovation to happen, including the external factors, he referred to the role of regulatory bodies/ government, capital availability, emerging technology and consumer adoption.

“Countries like India and China, their banking regulation is acknowledging the need for different models and place for different types of players around payments specifically and overall around financial services,” he said. This means the introduction of payment bank licence in India, which didn’t exist earlier.  


Fintechs have been disrupting as well as dis/ intermediating every step in the credit card value chain.

“(Fintechs have scrutinized) every aspect of the credit card value chain – issuance, activation/ usage, experience and acceptance. Different fintechs have picked up different aspects of the value chain elements in credit cards and they have disrupted each one of them,” said Chandak.

For instance, on the issuance aspect, Chandak referred to a card by Amazon Pay and ICICI Bank in India. The two entities have shared that their credit card has become the fastest in India to cross the milestone of one million, in less than 20 months of its launch. Highlights include issuance of reward points directly into Amazon Pay balance and contactless feature embedded in all cards. The convenience aspect has stood out, for e.g., being the first to introduce ‘Video KYC’ facility for new applications in June this year.

There is a promise of instant issuance of cards in less than one minute and 100% digital video KYC-enabled issuance. Referring to credit risk innovation, Chandak said there is only coverage for 15-20% of the population in India in terms of actual verified credit scores and accordingly the credit card penetration is relatively low.

“Merchant data is often extremely handy here and there co-brands in India are beginning take off where merchant data adds value to the underwriting models of these banks,” he said.  This is where a number of regtech companies are enabling a paperless, remote on-boarding for end-users.

  • For usage, Chandak referred to seamless payments, rewards innovation, real-time experience and personalization.
  • Referring to the experience part, Chandak mentioned a credit card, OneCard, re-imagined for the mobile generation.
  • As for acceptance, he highlighted merchant/ POS innovations and authentication innovations (biometrics, voice authentication etc.).

All of these developments underlined that loyalty and co-brand specialists need to make the most of the situation by looking at the value chain and the overall customer experience.


Remaining Top of Wallet - Co-brand & Travel Rewards Virtual 2021


Ai Editorial: Travel brands must get into “purchase frequency” loop

30th November, 2020 

Customer-centric companies are exemplifying exceptional agility. The #Covid19 pandemic is possibly the biggest 'tear-up' of how you do things in such a short space of time based on genuine real-time changing consumer behavior.

A trigger is take-up of services that facilitate #touchless interactions. This preference is seeping into our lives and a major reason behind why certain brands are being preferred today.

Shopping, as an activity, is revolving around this. And travel brands have an opportunity to come into this loop.

Few months ago experienced loyalty and payment executive, Jonathan Vaux, in an interview with Ai, referred to a healthcare app (Vitality) that he uses, and avails coupons/ vouchers from the same. And for a coffee voucher, he considered another app/ wallet (YoYo). Vaux chose not to visit the store for #redemption because of the pandemic. “All three brands have reworked on the utility of a coupon and ensured home delivery is possible via a loyalty app,” said Vaux. 

It is imperative to assess what a consumer is looking for and how to get into that loop is what counts. This one of the reasons by financial technology (fintech) specialists are making inroads into consmers’ lives, looking at day-to-day activities.  

During a recent Ai conference, Kate Morgan, Head of International Partnerships, Auriemma Group stressed on the significance of maintaining the existing credit card customer base in today’s environment. She referred to certain offers/ initiatives resulting in more frequent use of cards. The list included discount delivery on food orders, increased cashback rewards in certain category, extended sign-up bonuses etc. are examples of the same. 

Travel merchants can also look at consumer insights resulting from co-brand card data in order to understand the profile and shopping behaviour of cardholders.

“Co-brand data enables you to fill in the blanks in consumer knowledge with a more holistic view of your customers’ behavior away from your brand,” said Paul Alexander, Group Chief Executive, Beyond Analysis during Ai’s Co-brand & Travel Reward Cards Virtual Conference 2020.


By Ritesh Gupta

Ai Team


#CoBrand, 2020 - Counting on the prowess of co-brand data

11th November, 2020

A merchant must look at the overall market and consumer insights resulting from their co-brand card data to understand the profile and shopping behaviour of cardholders.

“Co-brand data enables you to fill in the blanks in consumer knowledge with a more holistic view of your customers’ behavior away from your brand,” said Paul Alexander, Group Chief Executive, Beyond Analysis during Ai’s Co-brand & Travel Reward Cards Virtual Conference 2020.


“It (significance of co-brand data) is often misunderstood by the organizations we work with,” said Alexander.

Often a co-brand relationship tends to be set up by the finance department within a merchant in order to generate additional revenue for the organization without thinking about the huge amount of value that could come from customer data collected by the financial services partner within a merchant’s co-brand partner relationship plus extended co-brand card relationships elsewhere. It is vital to assess - how much customers are transacting with you and with others on a certain co-brand credit card and with that financial services partner’s wider customer base.  Insight that comes from beyond the main relationship is extremely critical, too. “A customer spending $1000 (via a merchant’s co-brand partner relationship) is spending $5000 with our competition. What would you do differently  as a result of that knowledge,” must be probed and acted upon.

Insights from co-brand data:

  • Identify high value customer segments
  • Quantify headroom opportunity to know where to invest
  • Understand the profile and shopping behaviour of cardholders across your business to deliver the most relevant proposition
  • Evidence base from which to develop your business strategy
  • Drive better ROI and accountability on your  acquisition and retention strategy

“(Target) enriched knowledge and context of your own customers, even when they are infrequent,” said Alexander. The initiative must result in improved evaluation of customers’ true spending power and shopping behaviour to optimise marketing and commercial decision-making and investment.

By Ritesh Gupta

Ai Team


Loyalty Programs and the Pandemic

Interview with leading Loyalty Expert, Steve Arsenault by Madeleine Anderson

It has been a rollercoaster of a ride for the airline and travel industry over the last few months.  For many industry players, it has been their loyalty program that has come to their rescue.  Not only continuing to generate revenues for them in the absence of travel.  But, also, providing them with much needed cash which several big players have borrowed against the assets of their programs.

Steve Arsenault was recently interviewed by Madeleine Anderson to discuss the various developments that program operators have deployed.  You can see the interview in the video below.  

If the video player is not rendering on your screen try this link below:

And, if you have seen some other innovations relating to what programs are doing around the world then please drop Michael Smith a line MSmith(at)


“Pay over time” and travel sector – strengthening ties during the pandemic

14th September, 2020

Facilitators of “buy now pay later” (BNPL) are expanding across the globe. They are not only encouraging consumers to pay via debit cards, but they are also starting to reward them via loyalty initiatives.

A specialist in this arena, Afterpay, has shared that its growth momentum continued in all markets with FY20 global underlying sales increasing 112% to $11.1b (year ended June 30). Active customers more than doubled to 9.9m. An average of 20.5k new customers were added to the platform per day during the last quarter, exemplifying growth during the pandemic. The company went live in Canada, and also chose to acquire Pagantis (will offer Pagantis' BNPL products under its European brand, Clearpay). It is also available in Australia, New Zealand, the U. S., the U. K. etc.


Afterpay’s model -  it charges retailers to offer customers interest-free installment plans by splitting a purchase amount over four manageable fortnightly installments, available both online and in-store or via the iOS or Android app. By enabling customers to enjoy the benefits of splitting any purchase into these four, manageable installments with zero interest, the increased ability to plan and budget cash flow accordingly has resonated strongly with the Afterpay customer community. Customers can not revolve in debt, with no exceptions, and neither are they able to make further purchases if an installment is overdue. “These simple and transparent rules make Afterpay different,” shared a spokesperson. Customers can select Afterpay at checkout online or through the apps of its merchant partners. Afterpay currently has 55k+ merchants and almost 10 million customers globally. 

Travel sector

Afterpay has announced a couple of travel-related initiatives in Australia in the recent months. It launched a partnership, allowing Qantas Frequent Flyers to earn Qantas Points with the BNPL platform. In April this year, Afterpay and LayAway Travel collaborated to create a new travel service, PLAY - a platform that helps Aussie travellers’ pick, book and pay for their holiday over a series of installments prior to their departure date.

Travel brands like Qantas acknowledge that financial services is one of the most popular ways to earn points in the program.

Afterpay has had Jetstar on its platform for three years now offering customers the ability to pay for their holidays in four fortnightly installments. “We also launched with Agoda and Webjet earlier this year, in addition to our partnership with PLAY,” the spokesperson told Ai. “We are always guided by our customers as to where they want to see Afterpay made available and there is definitely appetite in the travel space, particularly prior to the Covid-19 pandemic.” The company asserted that by offering customers a BNPL solution, travel and airline brands are able to offer choice to customers that are looking for a transparent, flexible and easy solution to pay for their travel that doesn’t incur interest and allows customers to budget responsibility, which is particularly important during this time.

The team at Afterpay also works on customized flexible payment offering for a travel e-commerce platform. For instance, in case of PLAY, customers can design a holiday and payment cycle that suits their budget. “They can select to pay with weekly or fortnightly installments which are automatic and always interest free. The holiday is then paid off by the time they depart, meaning they avoid coming back from their holiday with a debt-lag,” said the spokesperson. 


Explore payment-related trends at the upcoming Airline Travel Payment Summit - ATPS Virtual Conference 2020

Date: 20 - 22 Oct 2020


Personal finance apps + payment = opportunity for travel merchants?

17th August, 2020

Aspects of personal finance, including spending, saving and investing, are under scrutiny. A detailed understanding of it, including the logic behind certain decision-making, can be the best starting point for encouraging spending whenever one is ready.

The specialists in "Buy Now, Pay Later" payments category are going beyond their financial wellness stance and have started their own loyalty programs.  


After Klarna’s move to work on a rewards program, Afterpay announced its new loyalty program last month.

Drifting away from excessing spending

These companies assert that till date loyalty programs have revolved around excessive spending.

They point out that consumers are now being rewarded for paying in a way they prefer, with their debit cards. Klarna mentioned that shoppers would earn a loyalty currency once their payments are completed and paid on time.

Travel merchants must assess how consumers are looking at saving money and spending it. Affirm has already “seen the momentum around savings firsthand” and also mentioned savings may yield future travel spending.

So is it time for travel e-commerce players to be a part of apps that reward consumers for saving, spending or even investing in a new way?

By Ritesh Gupta


Co-brand & Travel Reward Cards Virtual 2020


Increasing revenue on the billing as a loyalty program operator

28th July, 2020

Interview with Jason Adessky

The reality is – it is hard to foresee revenue generation escalating in the foreseeable future, but certainly there can be ways to mitigate the downside on billings. How to work out the same?

Ai’s Ritesh Gupta spoke to Jason Adessky. Excerpts:  

Ai: Looking at the airlines vs. financial service providers’ equation, is the power balance shifting?

Jason Adessky: The key stakeholders i. e. travel suppliers (airlines and their FFPs) and banks/ financial institutions are both hurting in terms of spend and more in case of airlines since their ability to influence or encourage travel is being hampered. Travel suppliers are handicapped by restrictions (be it for advisories, bans or self-imposed travel restrictions), so can’t materially influence what little traveler behavior there is.  The whole idea of a traveler flying and spending more with an airline has been shaken. For an operator, aside from groceries and certain e-commerce related shopping, consumer spending is down – may not be catastrophically down as this segment tends to be affluent and tend to have more wherewithal in terms of where to spend, how to do it etc. But on the whole spend hasn’t been great. 

From a financial services partner’s perspective (banks, credit cards, insurers etc.) again spend for these segments are down, not dramatically, but enough to hurt. Incentives usually in place that revolve around miles/ travel are less attractive. Many are evaluating their strategy to motivate and engage customers. But since airlines have more direct exposure, they are hurting more, their primary advantage of international redemption seats doesn’t exist for short to medium-term. On the other financial services companies have relatively more flexibility to drive and change behavior.   

Ai: What happens to redemption when fleets shrink?

Jason Adessky: As a general principle, when fleets shrink, there would be structural changes within an airline and these will flow down to eventually have an impact on FFPs, associated partners and their ability to influence customer behavior as well. Fewer redemption, less attractive seat options, etc will result in reduction in 3d party billing. And FFPs become relatively less attractive. Airline’s and other travel providers natural reaction, would be to start shifting toward discount pricing and use the same as more attractive, immediate levers to incentivize price-sensitive travelers. This will compound the damage to FFPs effectiveness.  

Not all doom and gloom, though.

FFPs are phenomenal, sophisticated data and marketing machines, with a highly attractive, high yield, low capital business model. Some of the gloss may come off, but opportunities to grow are available if they are able to aggressively pivot and address the silos, inefficiencies and unnecessary friction that have crept into their internal and external relationships with partners. This crisis provides a unique opportunity to re-examine how value is created and shared amongst various stakeholders. As an example, when card interchange regulation came into Europe and Australia a few years ago threatening core revenue streams, programs and card companies adapted and more collaborative and creative solutions were found by sharing and taking a whole portfolio view. Sure, the products are not as profitable as they once were, but they are innovating to create new opportunities. Today, it is a different set of challenges, but if anything the upside from innovation and streamlining is far greater. 

Ai: How should a loyalty program operator go about increasing the revenue on the billing at this juncture?

Jason Adessky: The reality is – it is hard to foresee revenue generation escalating in the foreseeable future, but certainly there can be ways to mitigate the downside on billings. From my experience of running airline loyalty programs, first I would look at breakage. It is a huge lever. The miles that are sold and not redeemed end up swelling the profit.  One can carefully examine whether it (breakage) is a good profit or a bad profit, but a sophisticated loyalty program operator would have focused on certain segmented strategies in the past. But I would re-visit that lever…the historic or previous models won’t apply anymore. So the plan should be to re-assess the appropriate breakage strategies and reconsider how to influence those by individual, by segment and by partner to optimize the outcomes.

Second, I would consider redemption- since international travel and front-end redemptions are going to be constrained, the plan would be diversify redemption options. Considering that local travel is going to be the best option, my suggestion would be to look at high margin experiences. Local operators are hurting badly, and there is an opportunity to work with them, possibly by sending customers their way.  There could be lot of upside for both the parties.

Third and most importantly, it is time to re-visit the business model and the current ways of working (financial, technical and organizational). This crisis offers an opportunity from program and partner strategy perspective. There has been an enormous amount of friction and silos created over the years. It has negative impact on the growth of the program. The model hasn’t changed much in the last 20-30 years. With careful reengineering of financial services and programme economics and processes, I believe that there is a very real opportunity for cards to be offering better propositions at a lower cost and for airlines and FFPs to be far more efficient in distribution of seats.

Overall, a loyalty program manager needs cut down on the friction in the multitude of processes and break down silos that inhibit future growth of the program, whatever the situation looks like. It is time to be flexible, open-minded and aggressively think of change. The time to come is still going to be fantastic for those  airline loyalty businesses that are structured and managed for success. Now is the perfect time for pivoting and enabling the acceleration of the growth once a situation stabilizes a bit. 

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Leveraging 3rd party mobile wallet as entry point for travel


23rd July, 2020

Interview with Björn Goß, CEO, Stocard, an app with over 50m user


Connecting mad rush for toilet paper with emotional loyalty

22nd July, 2020

It is imperative for travel brands to dig deeper into consumer psychology and why certain behavior continues to exist or sway owing to the pandemic.

For instance, from travel loyalty perspective, how loyal shoppers, generally referred as affluent shoppers in this category, are spending, which categories they are looking at and how can full-service airlines bring the “earn and burn” cycle into the same?

Also, according to Comarch, consumer purchase decisions are influenced by their emotional state, and this intensifies during unsta­ble times. And to achieve emotional loyalty, brands must build and maintain three key components: affinity, attach­ment, and trust.

Highlighting the same in its latest report, Comarch mentioned: “this irrational and emotional state of mind results in a trio of buying states: “panic-buying,” evidenced by the mad rush on toilet paper that ensued; “social buying,” whereby shoppers grab what everyone else seems to be scooping up; and “frozen buying,” which finds consumers retreating from buying altogether, paralyzed by fears like, “‘my 401k looks pretty bleak; I’m afraid I’m going to lose my job”.

In this elevated emotional state, brands have an opportunity to stand out by offering the support that the consumers need to build a deeper and long-term relationship that can continue once the crisis is over.

Comarch emphasizes that companies must prepare for change in the organizational mind-set to put customer-centricity at the core of everything a brand does.

Download Comarch’s report

Some of the key points:

  • Understand the customer journey to provide seamless and emotional experiences
  • Personalize every customer interaction with the power of data and technology
  • Ensure transparency to build trust
  • Listen to customers
  • Build a loyalty program focused on customer needs
  • Continuously test and learn

By removing friction, rewarding members instantly and frequently, giving customers the ‘power to choose’, using ‘surprise and delight’ tactics and including “gamified” elements, brands can create a loyalty program that promotes lasting customer loyalty.


By Ritesh Gupta

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