Alaska Airlines announced the introduction of a debit card as part of its Atmos™ Rewards program expansion. It’s part of a larger plan to garner more flyers across all demographics. From the press release, it’s a key element in the Atmos™ Rewards growth strategy.
“Since launching, Atmos™ Rewards has accelerated loyalty growth and attracted new member cohorts. Active membership is growing at roughly four times the prior pace, while the average member age now sits below 40. More than half of new status members are Gen Z, underscoring the program’s appeal with the next generation of travelers.
With debit representing a meaningful share of U.S. payments and strong appeal among younger and new-to-country guests, the new Atmos™ Rewards debit card expands the program’s reach beyond traditional credit products.”
Adding new members to the loyalty program through a debit offering is a smart move. It can drive engagement from a younger demographic, and those who may not want or qualify for credit, but want to earn Atmos™ rewards points.
The shift toward debit
Debit now runs nearly level with credit in everyday use, especially with younger consumers. Recent research illustrates the growth in use:
- Debit is close to credit overall. In the Federal Reserve's 2026 Diary of Consumer Payment Choice, consumers averaged 47 payments a month: 16 on credit, 15 on debit and six in cash.
- Younger generations prefer debit. A U.S. News survey found 56 percent of respondents use debit most for everyday purchases, versus 31 percent for credit.
- Many skip credit entirely. In the same survey, 20 percent of Gen Z, Millennials, and Gen X combined say they never use a credit card. A separate U.S. News survey found 31 percent of Gen Z have avoided getting a credit card altogether.
- Lower-income households are debit-forward. PYMNTS Intelligence found 43 percent of Labor Economy consumers use debit most, compared with 16 percent for credit. One in five of this group didn't use a credit card at all in the past year.
The reasons are consistent. Younger consumers say they choose debit to avoid debt and to track their spending. For other debit users, the appeal is access to a card without a credit check or the risk of credit harm.
Preferences vary by generation
No single payment method fits every generation. Co-branded card programs built to drive loyalty through additional rewards may be risking growth and long-term sustainability.
Boomers
This generation typically prefers credit cards, averaging four per person. Credit use is driven by trust in a bank or a brand and the rewards that come with card use. Boomers tend to use credit for larger purchases and convenience, and pay off their balances monthly. Debit still plays a role in everyday spending, between 47 and 58 percent of Boomers choose it as their primary method for routine expenses.
Gen X
This generation shows blended habits with card use. They carry high average credit card balances and see credit as a top choice for big-ticket items, while leaning on debit for everyday purchases. Rewards drive their heavy credit use, and 60 percent carry a balance each month. They join loyalty programs for tangible perks such as discounts and cash back (71 percent), the overall value of rewards (64 percent), and affinity for brands they already use (56 percent).
Millennials
Millennials lean toward debit. Only 24 to 27 percent use credit most often, and roughly 71 percent call debit the most financially sound way to avoid interest and debt. They rely on digital wallets and debit for everyday spending, though 65 percent still hold at least one credit card.
They’re also loyalty joiners. Up to 90 percent belong to at least one program, attracted by instant value, seamless mobile integration, and exclusive perks, and they prefer smaller, more frequent rewards.
Gen Z
Gen Z uses credit cards the least, citing debt avoidance and real-time spending tracking. But they’re building credit early, with 40 percent using credit cards specifically to build a credit score, and their balances and utilization are climbing fast from a lower baseline.
They approach loyalty through a mobile-first, value-conscious lens, favoring brand alignment, instant access, and unique perks over traditional program models. With debit as the preferred payment method, offering only a credit card to build loyalty is not likely to appeal to this group.
It’s not just a card, it’s a strategy
Alaska’s new debit card shows how a loyalty program can grow without asking customers to change how they pay. By adding a payment type that younger consumers and those new to the country already use, Alaska widens its reach beyond credit and gives more people a reason to join Atmos Rewards.
This approach can be applied to any brand. Giving consumers more choice with how to build rewards expands the loyalty program’s reach, yields new customers, and can support current loyalty into the future. Because preferences differ by generation, the programs that grow will be the ones that reward customers for the payment methods they already choose.
