TMG Enhances Card Rewards with Merchant-Funded Option

Kelly Moore Consulting, Inc. (for TMG – The Members Group)

(Des Moines, Iowa – Sept. 7, 2012) – Financial institutions holding back on implementing a cards rewards program because of the perceived expense have a new alternative. The Members Group (TMG) today announced the addition of a merchant-funded rewards platform to its existing card rewards program, which is utilized by credit unions and community banks to optimize credit and debit portfolios. Merchant-funded rewards are designed to stand alone or supplement an issuer’s traditional rewards offering.

With merchant-funded rewards, merchants carry the cost burden often associated with rewards redemption. Merchants benefit from increased sales as a result of the program, creating what TMG’s Matt Flynn, director of client relations, calls a win-win for financial institutions and retailers.

“The trickle-down effect of Durbin’s cap on debt interchange and increased competition for walletshare among issuers is creating a need for a holistic set of tools to help community financial institutions get the most out of their portfolios,” said Flynn. “Merchant-funded rewards get issuers where they need to be competitively, yet affordably.”

“At TMG, our focus is making life easier. Anytime you can actually minimize cost while also improving a perk for cardholders, it’s a clear win for our card-issuing clients,” Flynn added.

Because merchants fund points in exchange for marketing exposure, issuers can extend the TMG merchant-funded program to all active cardholders or to specifically targeted segments as their individual strategies warrant. Although an enhancement to TMG’s existing rewards offering, merchant-funded rewards can also act as a stand-alone incentive, particularly on debit card programs.

According to First Data, merchant-funded rewards have been known to increase debit spending by as much as 8 percent when added to an existing debit portfolio.

“TMG’s merchant-funded option makes perfect business sense,” said Matt Levandowski, EVP for Heritage Family Credit Union. “It takes a tool once considered cost-prohibitive by many smaller issuers and makes it a viable option for increasing loyalty, driving revenue and building merchant-community relationships.”

About TMG
The Members Group (TMG) is dedicated to creating customized, technology-driven card processing and payment solutions for credit unions and community-based financial institutions across North America. Innovations in fraud management, loyalty programs, alternative payment systems and analytic reporting, and the competitive advantages they create, have helped TMG forge a new standard in offering cutting-edge credit, debit, ATM, prepaid card products and a P2P payment solution. For more information, visit

More News