Rethinking Rewards With a Loyalty Platform for the Debit Generation

Beyond the Credit Card Paradigm

For decades, co-branded credit cards have been the gold standard in loyalty marketing. Think of the familiar names: Delta SkyMiles from American Express, Amazon Prime Visa or Marriott Bonvoy Boundless. Such partnerships between banks and consumer brands have become synonymous with customer engagement, rewarding cardholders for their loyalty and making brands stickier.

But a quiet revolution is brewing, and it’s one that turns this model on its head. In an economy where many consumers are shying away from credit—due to tighter lending, generational preferences and regulatory headwinds—debit cards are now taking center stage.

Example: Galileo Financial Technologies. The SoFi-owned technology platform recently unveiled a first-of-its-kind co-branded debit rewards platform, debuting with an industry-first partnership with Wyndham Hotels & Resorts. According to Federal Reserve data, debit cards account for nearly one-third of United States consumer payments. With a rising generation of “debit devotees” looking for ways to earn perks without taking on debt, this innovation could not be better timed.¹ As industry data suggests, for many consumers, particularly younger generations, debit is not just a payment method; it’s a lifestyle.

What Is Co-Branded Debit—and Why Now?

That’s largely because the economics weren’t compelling. The 2010 Durbin Amendment capped interchange fees on debit cards issued by big banks, slashing the revenue pool available to fund rewards programs. For a while, brands simply didn’t bother. Yet over the last few years, several trends have converged to make co-branded debit not just viable but attractive:³

• Credit tightening. Lenders have become more conservative, pulling back on credit lines and approvals—making it harder for younger or underserved consumers to qualify for premium cards.
• Consumer preferences. Gen Z and millennials are notably debt-averse, favoring debit and prepaid solutions over revolving credit. Today’s young consumers see credit as risky—and rewards as expected.
• Economic shifts. Interest rate increases and the rise of Durbin-exempt sponsor banks (with under $10 billion in assets) have improved the unit economics of debit.
• Regulatory reappraisal. With brands reevaluating debit post-Durbin, smaller sponsor banks allow them to avoid caps and improve margins.
• Proven demand. Popular programs such as Bilt’s rent rewards and others have validated the market appetite for premium rewards outside of credit.

In brief, credit has become harder to get, and consumers are warier of it. These dynamics are making co-branded debit an accessible, loyalty-building alternative.

A Groundbreaking Platform: Turnkey, Loyalty-First

Here’s what sets it apart:⁵

End-to-end technology and operations

Galileo combines its industry-leading application programming interface (API) infrastructure with its core banking and user experience (UX) capabilities. This means brands don’t just get a debit card—they get a full-fledged digital banking experience for their customers.

Turnkey for brands

Unlike traditional partnerships that demand heavy lifting from a brand’s payments and compliance teams, Galileo owns the full stack—product design, infrastructure, rewards, risk and compliance—leaving only the acquisition to the brand. The program is issued through Galileo’s regulated banking partner, Sunrise Bank, which provides the compliant banking backbone for the debit accounts.

Significantly, however, Galileo positions the product for loyalty teams rather than as a payments initiative. By doing so, it seeks to empower brands to unlock the untapped potential of the debit card market, reinforcing and extending engagement where customers are already spending.

Flexible, simple economics

Rather than complex fee arrangements, brands pay per point earned or redeemed. This aligns incentives and makes forecasting straightforward, which is crucial for marketers managing tight budgets.

The Wyndham Program: Proof of Concept

The offering resonated with consumers. About 60% of users set up direct deposit—a key indicator of engagement and stickiness.

Even with Wyndham taking a conservative approach to perks, the debit card demonstrated that modest benefits can still drive meaningful engagement—and pave the way for richer offerings in future iterations.

Galileo’s long-term vision even extends beyond individual programs—imagining a future where loyalty ecosystems interoperate, such as those between Delta and Starbucks.⁷

Why Brands Are Taking Notice

These are precisely the segments that are hard to reach with traditional credit products, but who still crave perks and recognition. PYMNTS reporting has noted a resurgence in debit rewards programs in recent months, including offerings by Prizeout and Venmo as well as Galileo, fueled by the ongoing rise of debit as a preferred consumer payment method.

Unlocking ancillary revenue

By leveraging latent brand assets—inventory, perks, off-peak availability—brands can fund compelling rewards at lower marginal cost.¹⁰

Better control and economics

Unlike subsidized credit programs, debit programs are more self-contained, predictable and durable.

According to Galileo CEO Derek White, “The changing economics, driven by scale, modular architecture and access to multiple sponsor banks, open up new monetization models, making debit rewards strategically valuable.”

Debit-based rewards don’t rely on credit risk tolerance or macroeconomic cycles, making them a steadier play.¹¹

A Modern Loyalty Platform Disguised as a Card

What’s revolutionary about Galileo’s approach is its reframing of what a “card” can be.

The company described it as a modern loyalty platform wrapped in a financial product—signaling its ambition to make loyalty seamless for brands and consumers alike.¹²

Closing Thoughts: The Debit Loyalty Moment Has Arrived

When the first co-branded credit cards hit the market decades ago, they changed the way consumers thought about loyalty—making every purchase feel like progress toward something more.

Now, as the economic and generational winds shift, debit rewards are poised for their own breakout moment. Galileo’s platform demonstrates that brands don’t have to choose between engagement and economics—they can have both, while reaching an underserved but eager customer base.

For loyalty marketers and brand strategists, the message is clear: Ignore debit-first consumers at your peril. Wyndham’s early experience shows that even moderate perks can succeed—and the journey has only begun.

Over 90% of U.S. adults use debit, yet most brands don’t reward that spend. Galileo’s Co-branded Debit Card changes that. Our API-first platform simplifies the tech stack and accelerates time to market—helping brands turn everyday spend into lasting engagement.”

<sup>1. Mastercard data, per Galileo presentation to PYMNTS Intelligence.↩
2. The fees that merchants pay to card issuers when a customer uses a credit card to make a purchase.↩
3. Galileo presentation to PYMNTS Intelligence.↩
4. Ibid.↩
5. Ibid.↩
6. Ibid.↩
7. Ibid.↩
8. Mastercard data, per Galileo presentation to PYMNTS Intelligence.↩
9. Ibid.↩
10. Galileo presentation to PYMNTS Intelligence.↩
11. Ibid.↩
12. Ibid.↩</sup>