MARLBORO, Mass.—Debit card rewards are in decline, according to a new study that also shows a valuable consumer segment relies on them.
In 2014, 46% of consumers had debit cards with rewards. Today, only 40% do, according to data from Mercator Advisory Group.
But Millennials are using debit rewards, and financial institutions are eager to court Millennials long term, noted Payments Journal.
Debit rewards users are younger (46% are between the age of 18-34), less educated, and likely to earn less than $50,000 a year.
The converse is also true: consumers not motivated by debit rewards are older (61% are over 41 years old), better educated, and more likely to earn over $100,000, the study shows.
“Making this distinction is important, because rewards programs are expensive to enroll and maintain. Each cardholder enrolled in a loyalty program costs more than $50 annually to service, noted Payments Journal.