Why Instant Rewards Are Winning the Retail Loyalty War

Retailers pushing to make payments and loyalty programs faster and easier will win wallet share, Concora Credit Chief Commercial Officer Rolando De Gracia writes in a new PYMNTS eBook, “Headlines That Will Shape the Close of 2025.”

Speed is now the default setting for consumers. Tap a phone and the payment clears. Stream a show and it starts right away. Order groceries and they show up the same day. Instant gratification is becoming the expectation, even for retail payments. This trend will have shoppers favoring brands that deliver value in the moment.

Credit cards show how much this matters. Capital One and Chase have built programs where rewards appear quickly, and redemptions are either automatic (no cardholder engagement) or an easy and digital experience. With many retail co-brands, cardholders wait until their next billing cycle to see their rewards. That lag may not sound like a big deal, but it causes people to lose interest. If one card lets a cardholder use a reward right away and another makes them wait weeks, they’ll prefer (and remember) the faster one.

So how can retailers keep up? Loyalty programs tied to credit and payments need to start moving toward an instant-first model. Here are four ways to get there:

Make Redemption Seamless at Checkout
The strongest move bank cards have made is keeping redemption simple. Points show up fast and you can use them without thinking twice. With many retail cards, it works the other way around. Customers end up scanning codes, entering vouchers or tracking expiration dates just to unlock value. That kind of complexity makes rewards feel less valuable. If you want them to drive behavior, they need to be automatic and ready to apply when the customer checks out.

Reduce Friction in Payments
Mobile wallets have changed the game. Apple Pay, Amazon Pay, Google Pay and PayPal are where most shoppers already keep their cards stored. A single tap gets the purchase done. These four wallets continue to expand their utility, with customers storing airline and concert tickets, lounge passes, return vouchers, insurance cards and loyalty cards in their mobile wallets. Anything that stores access or value needs to be stored in one of these mobile wallets.  Bank cards leaned into this early, and customers expect acceptance everywhere now. When a retailer does not offer those buttons, checkout feels clunky by comparison. Most people will not type in 16 digits if they can buy the same item elsewhere with one tap. Fees may be higher, but the cost of lost sales is even higher.

Partner, Don’t Reinvent
Banks do not build loyalty programs in a vacuum. They create ecosystems with travel brands, retailers and tech providers that make redemption simple across channels. Retailers should follow that path. Plug into third-party solutions that already offer instant rewards and frictionless checkout instead of trying to design complicated systems from scratch. Once a customer selects a mobile wallet, it becomes their preferred digital-to-analog point of contact, and retailers should make sure that they accept these payment and redemption options.

Extend Inclusion to Non-Prime Consumers
Card issuers have proven the value of tailoring products to different customer segments. Premium cards deliver lounge access and perks, while entry-level cards keep it simple with cash back. Retailers can take the same approach and build loyalty programs that work for non-prime customers as well. Instant discounts, flexible payment options and easy-to-use rewards open the door to 75 million households, with $5 trillion in purchasing power, often excluded from programs developed with the prime credit customer in mind. That is wallet share waiting to be won.

The change in loyalty and payments is already underway. It won’t be solved in a day, but the retailers pushing to make programs faster, easier and more inclusive will grab the wallet share — and keep it for the long run.