NEW YORK—American Express may be looking at making loyalty reward points more like real money, according to patent documents recently published by the US Patent & Trademark Office.
The patent application filed by American Express back in 2014, titled “Third Party Digital Wallet Pay With points,” describes a new system in which individuals with credit card reward points could use them at checkout on e-commerce sites. Reward points would be listed as a payment option alongside traditional payments methods, such as credit and debit, VentureBeat.com reported.
Most current rewards program points are brand-restricted. For example, airline miles are primarily good for travel with the airline company that issued them, and if the points holder decides never to fly again, the points become worthless. American Express’ idea is to allow consumers to use reward points when purchasing goods, regardless of whether the company and merchant have a previously established partnership, VentureBeat.com said.
While American Express may think the need exists and may profit from it, it still remains to be seen whether this innovation would benefit their customers. VentureBeat.com said that due to the freedom such a program presents, a direct “pay-with-points” program could lead to consumers having to put up with a serious devaluation of their points.
“On the other hand, such a system may present a way for some individuals to unload points that would otherwise be useless,” the website stated.