Loyalty rewards on credit cards should qualify as money due to their increasing popularity among consumers, according to a report by The Public Interest Advocacy Centre (PIAC), an independent, non-profit law and policy organisation.
The regulatory body also claimed that Ottawa should put in place legislation to ensure people’s loyalty points are protected from arbitrary moves by issuers.
PIAC executive director John Lawford was quoted by Ottawa Citizen as saying that credit card points should enjoy protections similar to other forms of payment.
Normally, consumers are left with few choices when the loyalty programme providers decide to devalue loyalty reward points on their cards, which cause damage to their holdings. However, majority of consumers benefit from some form of loyalty offer, according to industry data.
Lawford said the issuance of currency has been the preserve of the sovereign, and when government actions result in devaluation, voters bring pitchforks and burn things and otherwise express their discontent.
Consumers treat reward points like currency, and if they get devalued, they get outraged.
Claimed to be a major source of revenue for Canadian banks, loyalty programmes often make significant contributions to bank’s annual income.