Credit unions can benefit from debit rewards using Samsung Pay

Samsung announced in November a valuable addition to Samsung Pay – Rewards. This represents some unique opportunities for credit unions to promote usage of credit-union-branded cards in Samsung Pay, with rewards to the cardholder, at no cost to the issuer.

Samsung’s rewards program offers an escalating earnings program: 10 points per purchase, regardless of amount, ramping up to the Platinum level where members earn 40 points per purchase if the cardholder makes 30 purchases each month using Samsung Pay on a Samsung phone or Gear watch. Redemption options include a $20 Visa prepaid card for 2,500 points, a Gear Fit2 for 8,000 points, among other items. That means that power-shopper paying everywhere with their Samsung Pay who achieves Platinum status could earn a $20 gift card every two and a half months, or can get a Fit2 in a little over 6 and a half months. Granted, this is not as rich as most credit card reward programs, but this is in addition to any rewards that a credit union offers, such as ScoreCard … at no cost to the credit union.

The benefits for credit unions to promote, encourage and take advantage of this opportunity are numerous:

  • Promoting Samsung Pay is a great way to offer a rewards program for your debit card holders and have Samsung pick up the tab. Once your credit union’s BINs are enrolled in Samsung Pay, credit unions should encourage members to load their debit card in the app and earn rewards, without any cost or hassle to the credit union.
  • Credit unions can “double down” by offering one-time incentives to members to load the credit union-branded credit card into Samsung Pay as their “top of electronic wallet” default. If the credit union already has a rewards program, this would allow their members to “double dip” rewards points, with no additional cost incurred by the credit union.
  • For those credit unions that do not offer a rewards program, this would allow the credit union to enter the rewards space to see how their members respond, with minimal risk and cost.
  • Unlike the need to accrue for unredeemed points in traditional reward programs, there is no need to account for extra accrual dollars to fund the Samsung Pay program.
  • Unlike traditional rewards programs, there is no need for credit unions to calculate the cost of points redeemed.
  • Samsung handles all fulfillment of prizes/gifts.
  • Credit unions can promote the digital wallet solution that is the most widely accepted by all merchants due to their “Magnetic Secure Transmission” (MST) technology.
  • To accommodate the many members that do not have a Samsung device, credit unions can combine this opportunity with promotions to enroll the credit union-branded credit and debit cards into Apple Pay and Android Pay. For credit unions that have not tokenized their BINs and enrolled their BINs into the “Pays”, they should take advantage of offers from their processors to kick-off this process.
  • Promote fraud prevention. Samsung Pay, Android Pay, Apple Pay all offer advanced security over card usage at the POS, as these transactions are tokenized, thereby preventing counterfeiting. Even if a breach occurs, fraudsters only end up with a token associated with that specific device and cannot be used from any other source.

Samsung has provided a unique opportunity in the mobile payments space, an industry that is still in its infancy. This is an opportunity for credit unions to use their strength and spirit of community to help their members take advantage of secure and convenient technology.

Mike Chenderlin

Mike Chenderlin

Mike Chenderlin, CSCU Sr. Portfolio Consultant, has more than 20 years of relationship management experience. In addition, he has 10+ years of credit card experience having worked for Equifax/Certegy ... Web: www.cscu.net Details

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