Chase Card Users To Find Pay Apps Rewarding

by Raymond Pucci 0

business man entering data of a credit card . On-line shopping on the internet using a mobile phone

Chase credit cardholders will ring in the New Year with an expanded, but temporary, incentive program when making mobile payments. As the following article describes, Chase is offering cash back not only on its Chase Pay app transactions, but also when using its Freedom card as part of a smartphone mobile wallet.

Chase, the biggest issuer of general purpose credit cards with $141.8 billion in outstanding balances, will offer 5% cash back for Chase Freedom cardholders when they pay with a mobile wallet in Q1 2018. The offer is good on the first $1,500 spent on all items using Chase Pay, Apple Pay, Android Pay or Samsung Pay, according to a press release.

Cardholders can also earn 5% back when they make qualified purchases — through mobile wallets or traditional payment methods — at gas stations, streaming services Spotify, Hulu and Netflix and merchants of internet, cable TV and phone services.

The deadline to activate the offer is March 14, and is retroactive back to Jan. 1, per the release. Otherwise, Chase Freedom cardholders will receive the standard 1% cash back on all purchases.

Interestingly, Chase Freedom is offering rewards for people who use Chase Pay or who have their credit card loaded into a third-party payment service like Apple Pay, Android Pay or Samsung Pay. Basically, Chase is promoting mobile payment methods overall while emphasizing its role in adding value to consumers’ electronic wallets.

Chase Pay is a separate app from Chase Mobile, but the bank may need to eventually combine the two, especially as banking services become more commoditized and non-bank wallet providers add more functionality.

Mobile payments have been a tough sell for the universal pay apps—Android, Apple, and Samsung. Consumers just do not see the value in using a mobile app to simply make a POS payment. But when incentives, marketing offers, and integrated features are added, that’s a different story. Credit card issuers have learned that customers like the gamification of card programs that provide points, airline miles, and cash back. While this Chase promotion lasts just one quarter, there will be enough user stats and insights to assess the impact of the incentives. Stay tuned.

Overview by Raymond Pucci, Associate Director, Research Services Advisory Service at Mercator Advisory Group

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