Umpqua Bank offers cash back for using card

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Umpqua Bank is offering benefits to customers who buy with their debit cards at certain businesses. Photo illustration by Photos.com, Mail Tribune staff

June 20, 2007

By Greg Stiles

Mail Tribune

Shoppers have grown accustomed to a variety of retailer loyalty programs involving club and charge cards.

Fred Meyer rewards customers with coupons in the mail, Safeway with discounts at the checkout register and pennies off gas pump prices. Discover Card and American Express provide rebates built up every time money is spent.

Umpqua Bank has jumped in with a different twist. Umpqua Debit Rewards is a debit card rewards program offering cash back for shopping at participating businesses and online retailers.

Umpqua launched its program Monday with about 100 merchants — mostly in the Willamette Valley — in tow, said Steve Gervais, a business relations banker with Umpqua. The Roseburg-based bank's 110,000 checking customers figure to both find new shopping destinations, earn cash rebates and support the state's Boys & Girls clubs.

The program is handled by Denver-based Rainbow Rewards, a 3-year-old firm that recently expanded its reach to the Pacific Coast. Although the system is designed for debit cards, Gervais said Umpqua customers can register to run their Umpqua credit cards through the program as well.

American Banker research shows customers spend 20 percent to 35 percent more when they're using credit cards, Gervais said. Loyalty programs also increase average totals at the checkout counter.

The bank has been recruiting merchants in Southern Oregon for the past month with Pak Mail, Medford Mattress, Lawrence's Jewelers, Garrison's Home Furnishings, Big Town Hero and Rapid Refill Ink being among the early adopters.

Umpqua's reward system also works with online merchants like iTunes, Nordstrom.com and REI.com.

Umpqua Bank spokesperson Lani Hayward said the program connects merchants with customers, charging them for the service only after a transaction is completed. Stores pay Rainbow Rewards a marketing fee of 3 percent to 18 percent of the purchase price. If the store offers a 9 percent debit card rebate, for example, it pays Rainbow Rewards 12 percent and Rainbow keeps 3 percent for operating costs, marketing expenses and donations to a designated charity.

Gervais said once an rebate account reaches $10, a check is sent to the customers.

"After that, they have the option of a check or direct deposit," Gervais said. "Merchants receive monthly reports on what the debit rewards program does for their store."

Reach reporter Greg Stiles at 776-4463 or at business@mailtribune.com

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