You may already have a debit card program. It could be that it never really took off, it’s slowly declining, or could be considered successful. There’s always room for improvement.
New data on consumer behavior, digital wallet adoption, and the pay-by-bank trend is changing the debit landscape. If your debit program hasn't evolved in the last few years, you're likely leaving engagement (and revenue) on the table.
Debit outperforms credit
Perhaps given the shift to digital wallets and use by younger generations, debit cards are used for 29-32 percent of all transactions, and is growing at a faster rate than credit. Six in 10 shoppers use debit for their next purchase. There is ample appetite for debit, and for new cards. There are two primary drivers for this preference:
Behavioral shift: Debit is now used for everyday — and daily — purchases. Consumers increasingly prefer transparency, control, and real-time visibility over credit’s borrowing model.
Generational tailwinds: Gen Z and Millennials favor debit or debit-first behavior. For this cohort, credit approvals are falling and debit appeals to the credit-averse in this segment. For companies, this expands the addressable market for branded cards and financial products.
Why most debit programs underperform
In the early days of branded card offers, consumers flocked to their preferred brand to earn additional points, miles or other perks. Loyalty played a large role here, encouraging the already loyal customers to add a card to boost their status and rewards potential.
It’s turned upside down. Now, with more cards to choose from, often offering competitive parity, consumers select the card that gives the most of what they care about, and the brand attached to the card is secondary. With easily accessible price comparisons, consumers will enroll in a variety of loyalty programs to ensure coverage for any (and all) purchases.
Long-running programs can become stale, and with additional competitive pressure, it’s a race to the bottom, sacrificing more and more margin to attract and retain customers. Card programs are exciting when launched, and can quickly fall into a set-it-and-forget-it state.
The reboot: Optimizing an existing debit card program
Rewards and points tied to debit spend
Complementary to credit card programs, cardholders earn with spending, so everyday purchases, where debit is often used, become rewards opportunities. Leveraging first-party spending data, companies issuing debit cards can personalize offers and build real-time engagement. These cards are tied to loyalty programs, offering an additional way to earn, and enhancing daily interactions.
Debit has an important distinction: The ability to hold funds. Cardholders can hold funds in their debit card accounts, earning loyalty points and rewards. These accounts generate yield, and that can be used to fund richer rewards, encouraging more engagement and loyalty.
Better launches through early month on book (EMOB) focus
Habit creating takes time, but the first 60-90 days of any card program are critical. Creating compelling activation offers, faster access to status and rewards, and ongoing promotions compel cardholders to use the card more often. And that creates top of wallet stickiness.
These early days provide an excellent testing ground for offers, UX flows and flaws, and buy patterns. Where does onboarding drop off? When is the card most used? What purchases claims the largest dollar spend? How are debit cards being funded? These are all questions that lead to program optimization, and can quickly iterate to make adjustments.
Four steps to do now
1. Audit your current debit program performance. Monitor acquisition channels, demographics, promotions and offers.
2. Identify the gaps in rewards, earning progression and speed, app engagement
3. Build a roadmap to capture quick wins and drive longer-term transformation.
4. Consider a re-launch to acquire new cardholders, and reward the loyal cardholders.
Debit isn't just a payment method, it's a relationship.
Like any relationship, it requires attention, investment, and a willingness to evolve. The programs winning today are the ones that keep showing up, with compelling offers, richer engagement, and a clear understanding of what their cardholders actually want. Whether you're starting from scratch or breathing new life into an existing program, the opportunity is real. The data says consumers are ready. Is your program?
