Saturday, May 19, 2007

Interesting practice: rewarding debit card use

See the aticle here to see that El Paso County’s two largest credit unions have joined with a Denver-based company to pay cash rewards for debit card transactions with some merchants:

Ent Federal Credit Union began paying rewards of up to 20 percent Tuesday on debit card transactions with 128 local merchants and about 1,900 others statewide, while Air Academy Federal Credit Union expects to launch its program within three months.

Both credit unions are offering the cash rewards through a partnership with Rainbow Rewards USA Inc., which started the program three years ago. The program also is offered by 16 other Colorado credit unions and a credit card offered through Frontier Airlines.

Some banks began paying rebates and rewards to customers to encourage debit card use about 10 years ago, but the programs are now becoming more widespread, said Larry Martin of Bank Strategies LLC, a Denver-based bank consulting firm.