American Express Blockchain Pilot To Streamline Loyalty Rewards Programs

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American Express is taking its involvement with Hyperledger Project to a whole new level.  The credit card company is piloting the blockchain technology with online retailer Boxed to enable it to customize rewards for its American Express cardholder customers, PaymentsSource reported.

American Express will monitor and manage the pilot project through a private channel on its blockchain to facilitate secured information transfer with Boxed.  This allows the merchant to create smart contracts that will automatically fulfill rewards program offers for its customers.

Once the offers are made to cardholders, the smart contracts will anonymously pass the information on the transactions using American Express blockchain channel. As the information is sent anonymously, it cannot be traced back to the individual cardholder.

The new system will allow merchants to establish offers to cardholders “in a matter of weeks”, as opposed to months, thus accelerating the process of onboarding a merchant and creating a reward program, the company believes.

While merchants have control to what offers they are creating, as well as how they customize its Membership Reward structure, AmEx still reserves the right to regulate the products and brands being promoted to ensure they align with its brand values and merchant agreements.

In an effort to draw interest to its blockchain project, American Express will offer its cardholders five times the Membership Rewards points on certain products and brands.

The testing of the American Express blockchain with Boxed comes just over a month after the company shut down its multi-channel loyalty program, Plenti.  Plenti struggled with high redemption rate and unstable leadership and saw retailers dropping out for the past several months. It will officially end on July 10.

Noteworthy, American Express joined the global cross-industry project, HyperLedger early last year as contributing member, indicating its intention to leverage blockchain technology to offer new kinds of financial services to its customers.

Ray Battrick is a certified blockchain expert and FinTech copywriter who is devoted to working for you to build blockchain-based applications for your business. Ray is also a FinTech copywriter who is skilled at creating persuasive content for a wide range of products, including financial technology, business blockchain, investing and more. As an avid blockchain enthusiast, Ray enjoys writing about business blockchain, ICOs and cryptocurrency investment.

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