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Rewards come roaring back…with a big twist

first_img1Pulse, “2014 Debit Issuer Study,” June 2014 2The Wall Street Journal, “Consumers Say More Rewards Is Their Top Demand From Banks,” August 2014 3Bond, “The Loyalty Report,” 2014 30SHARESShareShareSharePrintMailGooglePinterestDiggRedditStumbleuponDeliciousBufferTumblr,Dante Dominick Danté Dominick is an award-winning content and marketing strategist with specialized knowledge for the financial services industry. He has helped over a hundred community financial institutions improve their image, creative … Web: www.buzzpoints.com Details It’s funny (but not in a ha-ha way) how far-reaching the effects of the Durbin Amendment are for consumers, who largely know very little (if anything) about the legislation.One such example was the disappearing act of debit card reward programs, which declined by 43% from 2010 to 2012.1 But that trend has reversed dramatically. The “2014 Debit Issuer Study” finds that 47% of financial institutions (FIs) offered a debit reward program in 2013, a 47% lift from 2012.1 That’s a complete about-face and all signs point to continued full-throttle growth. This is largely due to a major shift in how these programs are structured.A key takeaway for credit unions: consumers are coming to expect these rewards, even shopping the benefits of varying programs. In fact, The Wall Street Journal reported 88% of North Americans say rewards for banking activities are a top priority (the highest score in the study).2So it’s becoming a table stake to attract and retain members. But not just any program. Details are below, but to avoid burying the lead, here are four keys to a successful program:Don’t pay for the costs of the rewards; other parties will happily do so for you.Offer equal rewards on PIN- and signature-based transactions.If you issue credit cards, have your reward program work on both debit and credit purchases.Offer rewards for any purchase, anywhere.Shifting Costs Yields a Win-Win-WinThe previous dip in debit rewards was a direct result of the Reg II interchange cap placed on most financial institutions, which made the programs too costly. The primary driver in the resurgence is an overwhelming industry trend of shifting the cost of the rewards away from the financial institution. A common method is tying the program to rewards redeemable at retail locations, with either the merchants or third-party reward providers paying for the cost of the rewards. The card holder wins with discounts on things they buy; the credit union wins with increased interchange revenue and member satisfaction; and the merchants win with increased customers and larger spend per purchase.How prevalent is this shift? 55% of FIs issuing a rewards program had a merchant program in 2013, up from 38% in 2011. Meanwhile non-merchant programs dropped from 62% to 39% over the same period.1 Quite simply, why would a credit union incur the expense of the rewards when they don’t have to? Especially when there are other parties who will happily do so to gain a seat at the revenue-generating table.Make It Easy To Earn (aka, Signature-only Rewards Is a Sinking Ship)Pre-Durbin, to cover reward expense FIs everywhere steered account holders to choose signature instead of PIN for debit transactions—to the point of frequently only offering the rewards for signature-based transactions (which yielded far greater interchange profit).While FIs under $10 billion in assets were spared Durbin’s interchange cap, they weren’t entirely spared the effects. For FI’s over $10 billion, the interchange revenue per PIN- and signature-based transactions was $0.24 and $0.23 respectively. Factoring in the lower costs for PIN, these large institutions reap $0.21 in net margin per PIN transaction compared to $0.14 for signature.1Why does this matter for credit unions that are exempt from this cap? Because for the first time, the big banks are on the same side as retailers in favoring—and pushing for—PIN transactions. Those are two powerfully influential forces on driving consumer behavior. Couple this with the fact that PIN is more convenient for and popular with consumers anyway, and it’s clear that a signature-only reward program is not going to appeal to cardholders.This may be unfortunate, since the net margin per transaction for exempt FIs (under $10 billion) is very different at $0.24 for PIN and $0.35 for signature.1 But it is reality. The sheer volume of PIN transactions will have to make up for lower margin. That, and the fact that rewards tied to PIN transactions will keep your card at the top of your members’ wallets. Whereas a card without them will find its way out of their wallet.Double Your Wallet Share With Debit & Credit RewardsAmericans are enrolled in an average of 10.9 loyalty programs, and are active in 7.8 of them.3 While some of these are tied to individual retailers, many are programs tied to the multiple debit and credit cards that individuals have at multiple institutions. To win the battle of the wallet, make your cards the easiest to use at the most locations.It’s no coincidence that the three characteristics below, which card holders revere, are all in the above list in how to successfully propel adoption and recurring use of your loyalty program.If you issue credit cards, have your reward program work on both debit and credit purchases.Offer equal rewards on PIN- and signature-based transactions.Offer rewards for any purchase, anywhere.The fourth key to a successful program—don’t pay for what you don’t have to—is just common sense.last_img read more

A few renos and four years later this Taringa home has sold for $470,000 more than its owners paid for it

first_imgStanley Tce, TaringaA FEW renovations and four years later this Taringa home has sold for $470,000 more than its owners originally paid for it.More from newsMould, age, not enough to stop 17 bidders fighting for this home2 hours agoBuyers ‘crazy’ not to take govt freebies, says 28-yr-old investor2 hours agoThe home at Stanley Terrace, Taringa sold under the hammer at auction for $1.34 million through Ben White of Place New Farm.Mr White said the owners paid $870,000 for the house four years ago and renovated it to sell. There were three registered bidders.“The buyer is from Melbourne, but originally from Queensland, and is moving back to Brisbane permanently,’’ Mr White said.The three-level, five-bedroom home is on a 835sq m block. It has double high ceilings and there is a fireplace with glass sliders which opens directly onto the rear deck.The kitchen has dark benchtops, white cabinetry, stainless steel appliances and a glass splashback.last_img read more

LMC Fines Katsina Utd N1m for Not Allowing Rangers, Four Others…

first_imgThe League Management Company (LMC) has fined Katsina United N1million and a possible banishment from the Muhammadu Dikko Stadium for severally not allowing visiting teams access to train on their registered home ground for matches as provided by the Nigeria Professional Football League (NPFL) Framework and Rules.LMC announced the penalties Wednesday after reviewing the complaints by three other clubs and a similar complaint by Rangers International that they were prevented from gaining access to the Mohammed Dikko Stadium on Tuesday for a rescheduled fixture.Following a charge of misconduct in breach of Rule C1 of the Rules, the LMC exercised its summary jurisdiction to impose the fine on Katsina United. LMC’s Chief Operating Officer, Salihu Abubakar LMC’s Chief Operating Officer, Salihu Abubakar, in a letter conveying the decision to the club, stated, “You are in breach of Rule C1 (Misconduct) of the Framework and Rules of the Nigeria Professional Football League, in that you severally prevented or failed to permit the visiting teams from gaining access to your registered home ground for the scheduled pre-match training, thereby failing, inter alia, to act in the best interest of the game and comply with the principles of fair play and sportsmanship”.“Consequently, the LMC intends to exercise its summary jurisdiction and to impose on you the following sanctions: 1. A fine of One Million Naira (N1, 000, 000.00) for the several acts of misconduct and 2. A caution, to wit, in the event of a repeated breach, further or more severe sanctions could be applied, including but not limited to relocation of the club to another ground in the overriding interest and other considerations,” observed LMC in a statement yesterday evening.Katsina United has under the rules 48 hours to respond in writing with an option to accept the decision of the LMC or enter for a hearing.MFM, Kwara United, Insurance of Benin and Lobi Stars variously complained of inability to access the stadium for pre-match training.Share this:FacebookRedditTwitterPrintPinterestEmailWhatsAppSkypeLinkedInTumblrPocketTelegramlast_img read more