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Digital Gift Cards: The Secret Weapon for Neobanks

Posted on 11 April 2023
Read time 2 mins
Author Leigh Carrington

Neobanks are shaking up the financial industry with their innovative, customer-centric approach. However, despite their success, many neobanks struggle with acquiring and retaining customers. The solution? Digital gift cards.

Gift cards aren't just a popular way to give gifts - they're also a powerful tool for businesses to attract new customers, reward loyal fans, and drive profitable growth. And for neobanks, digital gift cards could be the secret weapon they need to stand out in a crowded market and win over customers.

So why should neobanks consider digital gift cards as part of their growth strategy? Let’s take a look. 

Happy neobanking customer

To help them attract new customers

With Tillo's innovative platform, neobanks can connect their target audience to the brands they love - making them magnetically attractive to new customers. Digital gift cards are a powerful acquisition incentive that can help neobanks stand out from the crowd and attract new customers who are looking for more than just a traditional banking experience.

To reward their loyal customers

Digital gift cards aren't just for acquiring new customers - they're also a great way to reward existing fans and show appreciation to those who are already loyal to your business. For neobanks, digital gift cards can be used as part of their loyalty program to encourage retention and long-term engagement, ensuring existing customers stay put and don’t explore other emerging neobank competitors. 

To encourage account activation and engagement

Acquiring new customers is only half the equation for growing neobanks. Digital gift cards are an easy way to balance attraction, activation, and retention to drive profitable growth year after year. By offering digital gift cards as part of their onboarding process, neobanks can encourage account activation to ensure that new customers also go on to become active users. 

The Power of Digital Gift Cards: Why They're More Effective Than Cash Incentives

When it comes to incentives, cash is often seen as king. But in reality, digital gift cards can be even more effective - and the reason lies in Mental Accounting.

Mental accounting is a psychological term that describes the tendency for people to separate their money into different categories based on subjective criteria, such as the source of the money or the intended purpose of the funds. 

Because a cash incentive is easily lost within a person's wider bank balance, it tends to be categorized mentally with their salary, where it ends up being spent on bills, groceries, and other day-to-day activities. 

Digital gift cards, on the other hand, sit separately from an individual's bank balance resulting in a different mental categorization that makes them feel more rewarded. Because a digital gift card isn’t lost within a person's bank balance where it is spent on bills, it is more likely to be used on pleasurable pursuits resulting in a greater emotive response. 

Unlocking the power of digital gift cards with Tillo

Tillo makes it easy for challenger banks to balance acquisition and loyalty, helping them to supercharge sustainable and profitable growth using digital gift cards. 

Our plug-and-go API can seamlessly connect neobanks to over 2,000 brands across 16 currencies and 36 markets, ensuring they continue to surprise and delight each and every one of their customers regardless of where they live, the brands they use, and how they shop.  

To find out more, get in touch with us today and see the Tillo platform for yourself.

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