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In today’s fast-paced world, credit cards have become an integral part of our financial landscape. They offer convenience, security, and flexibility, making transactions seamless both online and offline. However, credit cards are not just about making payments; they also come with a variety of value-added services that enhance the overall user experience.
One such service that has gained prominence in recent years is the Reward Loyalty Program.
Reward Loyalty Programs are designed to incentivize cardholders for their spending habits and loyalty to a particular credit card issuer. These programs offer differential reward points, closed-loop EMI programs, meta-data engines, and cardholder-defined actions, adding significant value to the cardholder’s experience.
Differential Rewards Points
One of the key features of Reward Loyalty Programs is the differential rewards points system. This module allows credit card issuers to offer rewards points to cardholders based on their spending patterns. It goes beyond just Merchant Category Codes (MCC) or Transaction Identification (TID) and can be customized based on various parameters such as pin code, duration, or specific MCC for specific dates.
For instance, cardholders may receive 5x reward points during special occasions such as birthdays or wedding anniversaries. The 5x rewards points applicable for specific MCCs could also be extended for a week starting from the day before the cardholder’s birthday, adding a personalized touch to the rewards program.
Another valuable aspect of Reward Loyalty Programs is the Closed Loop EMI Program. This feature holds immense potential as affordability, driven by EMI options, is a key consideration for many consumers. In December 23 alone, total credit card sales in India amounted to approximately Rs. 1.65 lakh crores, with approximately Rs. 9000 crores converted to monthly credit card spends converted to EMI.
The Closed Loop EMI Program not only offers affordability to consumers but also saves banks from network charges. This program provides a win-win situation for both consumers and issuing companies.
Meta Data Engine
The Meta Data Engine is a powerful tool that enhances portfolio management for credit card issuers. It allows teams to crunch vast amounts of data efficiently, enabling better decision-making. Instead of depending solely on Business Intelligence Units (BIU) for data analysis, the Meta Data Engine empowers portfolio and product teams to work collaboratively.
For example, product teams can run queries to identify new savings and proprietorship current accounts opened in the bank each month. They can then filter out existing credit card holders and share the remaining data points with the sales or call center teams to convert them into cardholders.
Card Holder Defined Actions
The Card Holder Defined Actions feature puts the power in the hands of cardholders, allowing them to take various actions through mobile applications. Cardholders can increase their credit limits without the need for a call, using OTP-based consent. They can also use their rewards points as per their preferences, with the burning ratio decided by the bank.
Furthermore, the integration with aggregator EUROP Assistance enables cardholders to redeem rewards across various industries and companies, enhancing flexibility and utility.
In Conclusion:
Reward Loyalty Programs in credit cards are not just about earning points; they represent a holistic approach to enhancing the cardholder experience, particularly appealing to the millennial demographic. By offering personalized rewards, affordability through EMI options, efficient data management, and user-defined actions, credit card issuers can truly differentiate themselves and add significant value to their customers’ financial journeys, aligning with the evolving preferences of the millennial generation
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