New app converts reward points to cash

New advances in mobile transactional technology could mean that credit card and lifestyle reward systems are ready to evolve to the next stage.

In December, Commonwealth Bank launched its Kaching app for iPhone users. The app’s Near-Field-Communication technology effectively allows phones to become credit cards, allowing payments to be made within a short range of an enabling terminal.

Now the airline Etihad has launched an iPhone app that converts loyalty points into cash that can be used in stores. This is bound to have follow-on effects for its flying partners, including Virgin Australia, and for the future of Australian loyalty programmes.

The gradual evolution of frequent flyer programmes to lifestyle reward schemes has eventually created the need for a system that allows the redemption of points over the counter.

This part of the system has been created by Swiss-based Loylogic, who promise that ‘members of participating loyalty programs will be able to use their accumulated points and miles at virtually any in-store and online merchant’.

The exact details of how the new app will work have yet to be announced.

A recent feature on Which4U assessed the popularity of airmiles credit cards and frequent flyer points as a viable long-term currency in Australia.

This technology, which is able to monetise reward points directly into cash, not only legitimises these reward schemes, but has the potential to thrust them deeper into the cut and thrust of Australian monetary economics.

Joe Letts