Bank of America, still smarting from the public backlash that torpedoed its proposed $5 monthly fee for debit cards last year, is rolling out a new idea to boost card activity — a program called BankAmeriDeals.
While the program hasn’t started yet, the idea is that customers will be offered discounts on future purchases based on what they’re buying with their Bank of America cards.
If a customer makes a purchase at an electronics store, for instance, the next time he logs onto his BofA account online, he may see a discount he could use the next time he buys something from that store. Customers who click on the deal to accept it and later make the purchase will pay full price for the items at the checkout counter — but will get reimbursed for the amount of the discount by Bank of America. The bank will total up the discounts a customer has coming each month and issue a credit to his or her account.
The act of getting something back from a bank is a far cry from the proposed fees for just using the cards. This plan also has convenience going for it. Unlike with other deals sites such as Groupon or LivingSocial, there are no coupons, promotional codes or email registrations and no separate website to check.
A company called Cardlytics acts as a middleman between BofA and retailers. The strategy is offering rewards linked to places where customers have already shopped instead of floating incentives for places they may or may not be interested in trying. Because the consumer has already shopped at their store, retailers have more confidence that they will return. The bank, meanwhile, has more confidence it can accumulate more swipe fees because customers must use their Bank of America cards to get the discounts.
Bank of America has started testing the rewards program on its own employees in Nevada, North Carolina and South Carolina, and it plans to roll it out to all associates in the next month.
The move comes as banks are looking for ways to build revenue lost to new financial reform regulations that curb debit card swipe fees.
Reuters reports that, with BankAmeriDeals, customers can choose to receive alerts about offers and how much money they have saved. They also can opt out of the service. The bank won’t say which retailers are participating, but said they include large discount department stores, fast food chains and local restaurants.
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