Kard Highlights Merchant-Funded Rewards Model as Alternative to Big-Bank Programs

According to a recent LinkedIn post from Kard, the company is highlighting market data that suggests rewards have become a baseline expectation for U.S. cardholders. The post cites figures indicating that eight in ten Americans have a rewards credit card and that nine in ten say they value those rewards.

The post further notes that a majority of cardholders, at 58%, now use cash back cards, and that this preference appears to be growing. It frames this trend as a competitive challenge for fintechs, neobanks, community banks, and credit unions facing large issuers such as Chase and Amex.

According to the LinkedIn commentary, smaller institutions may struggle to match big-bank rewards budgets without compressing margins. The post suggests merchant-funded rewards programs as an alternative, in which brands pay to reach cardholders, generating revenue for issuers while providing cash back to customers.

For investors, this focus on merchant-funded rewards indicates an emphasis on capital-efficient product design in the increasingly crowded consumer finance space. If Kard can position itself as an effective enabler of such programs, it could benefit from rising demand among smaller financial institutions seeking to offer competitive rewards without incurring large direct subsidy costs.