Stash has announced that is has given out over five million rewards since launching its rewards program earlier in 2019.
New type of rewards program: Called Stock Back, Stash’s banking customers can earn fractional shares in stock of the companies where they shop.
- Stash's rewards program is tiered, giving Stash banking customers users 0.125 percent worth of fractional stock when they make purchases using their debit cards.
- Stash sometimes offers more aggressive stock back rewards in specific companies. For example, when it launched its rewards program, the company offered 5 percent stock back in Netflix and Spotify and 2 percent at Starbucks and Dunkin.
- Stash is also launching a partnership with Booking.com to give customers up to 10 percent cash back when they shop with their Stash debit card.
Using rewards to nudge investing: Stash has seen a connection between rewarding users in stock and getting them to invest more.
- Nearly 30 percent of Stash customers who received a reward in stock went on to make additional investments in that security, according to the company.
- As Stash's program matures, the company now offers its customers the ability to pick their own Stock-Back Rewards exchange traded fund when shopping at companies without a matching stock on Stash.
"It's about ingraining a savings mentality and changing people's mindsets," said Brandon Krieg, CEO and co-founder of Stash. "There is nothing more powerful than giving customers the opportunity to instantly invest in the stock market just by living their lives."
Debit card as revenue model for new banks: Introducing a debit card and driving its usage is important for challenger banks like Stash, which uses Green Dot to power its banking service.
- Interchange fees from debit cards are frequently a powerful driver of revenues for companies like Stash. So, driving more usage of the card drives more revenues.
- Stash and its customers both win with its rewards programs as it builds more assets under management on the platform.
- Stash's revenue model incorporates subscription fees that begin at $1/month for a flat-fee subscription plan for an investment and bank account.
The company says it has four million customers and is adding thousands of new banking customers daily.