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Customers to earn $60.4bn in credit card rewards this year, research says

Customers to earn $60.4bn in credit card rewards this year, research says

Rewards to climb to $67.9bn in 2023 as consumer credit spend recovers post-Covid

Credit card users worldwide will earn $60.4bn in rewards this year, a new report by Juniper Research reveals. This figure will rise to $67.9bn in 2023 as consumer credit spend recovers post-Covid.

The research estimated a 13 per cent reduction in credit card spend in 2020 owing to the Covid-19 pandemic, with industries including travel, tourism and hospitality being the most heavily impacted. However, the study contends that digital reward schemes will be instrumental in encouraging spend in the economy during these uncertain times, predicting that credit card spend will return to growth in 2021.

With the number of credit cards in issue anticipated to exceed three billion worldwide by 2023, there is potential for brands to leverage card ownership and foster loyalty using rewards. The research found that credit cards can play a critical role in extending a brand’s ecosystem, such as Apple Card.

Issuers and networks must focus on enabling brands to effectively use cards, combined with app-based digital loyalty solutions, to foster improved customer retention. This approach will allow issuers and networks to boost their payment volumes, while also forming valuable brand partnerships, the report says.

“Card loyalty scheme providers should leverage digital platforms already used for payment security to better target and engage consumers via apps and push notifications, thus differentiating themselves from the competition and generating customer advocacy,” research author Susannah Hampton explained.

The number of app coupons redeemed will see growth of 42 per cent between 2020 and 2025 as mobile apps dominate the shopping experience, particularly in markets such as China and the US. The study predicts that businesses will increasingly leverage high smartphone penetration rates in developed regions to exploit the full potential of mobile apps to offer enhanced loyalty programmes for consumers.

Read: Mastercard taps Microsoft Azure to boost R&D in ecommerce, fintech

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