Financial services giant American Express has integrated blockchain technology to its membership rewards program.
Amex is leveraging Hyperledger, an open source blockchain project under the Linux Foundation, to allow merchants to create tailored offers involving membership rewards points on their own platforms that can deepen engagement and reward customers. The loyalty program offers card members choice and flexibility for earning and redeeming points across a number of categories including travel, dining, entertainment and more.
On the back-end, Amex will set up a private channel on their blockchain implementation with the merchant to securely pass information back and forth. Merchants can then create custom membership rewards earning structure and assign bonus to items at product or stock keeping unit (SKU) level. Once the offers are live, when a card member makes an eligible transaction at the merchant, the smart contracts will automatically pass the anonymized information on the transaction to Amex using its private blockchain channel.
“They can create programs based on a time of day, day of the week, by incentivizing a customer to download their app,” said Chris Cracchiolo, who heads up the Membership Rewards program for AmEx. “The number of ways merchants can reward customers with membership reward points will be exponentially increased.”
American Express reserves the right to regulate the products or brands being promoted. The company believes it can set merchants up with the new system „in a matter of weeks” versus the months it currently takes to onboard a new partner.
Amex is currently conducting a pilot trial with its merchant partner Boxed. The online merchant is offering eligible membership rewards-enrolled card members select promotion on specific products on its website. The offer features the opportunity to get five times membership rewards points. In the coming months, Amex plans to make the loyalty program available to all of the company’s merchants.
Back in March, American Express’ travel arm filed a patent related to faster payments and blockchain technology. The blockchain patent describes using the tech to facilitate payments between two parties by using transaction requests as a proxy. If approved, the solution would automate processing and adjust accounts on both ends of the transaction.
In November last year, the company has launched blockchain-based business payments using Ripple a fintech start-up. American Express said its FX International Payments (FXIP) business had partnered with Ripple to provide real-time, trackable non-card payments from the United States to Britain. “Transfers that used to take days will be completed in real time, allowing money to move as fast as business today,” said Ripple CEO Brad Garlinghouse in a statement.
„Tendinţele pe care le-am remarcat înainte de începerea pandemiei s-au accelerat pe perioada stării de urgenţă. Am văzut acest lucru ca o oportunitate, un tipping point pentru bancă. Post-pandemie nu avem cum sa ne întoarcem la comportamentul financiar pe care îl aveam până în februarie a.c. Relaţia românilor cu online-ul s-a schimbat. In plus, cardul fizic se va dematerializa. Vom asista la o scădere a cererii pentru cardurile fizice, respectiv la o creştere a preferinţei pentru componenta digitală a acestora.”