The Cash Revolution: Why Customers are Rewriting the Rewards Playbook
Published by Trisha Asgeirsson – President, SKUx
Generation Z has made their position clear: they want cash, not points.
In a 2025 Bank of America survey, 70% of credit card holders said cash-back is the best perk a card can offer. Among Gen Z cardholders specifically, 43% picked cash-back as their favorite reward, compared to only 9% who chose travel points. Boomers- though vastly different in age, agree with this sentiment, with 55% of boomers saying cash back is their favorite feature. The message isn’t subtle, consumers now value tangible money they can spend now over promises of future perks.
Points are losing their shine
Traditional loyalty programs built on accumulating points are seeing diminishing engagement from young consumers. Only 42% of Gen Z adults have a rewards credit card, far lower than the 70% of Boomers who do. More telling: more than 1 in 10 Gen Z cardholders never redeem their points at all – the highest non-redemption rate of any generation.
The reasons are straightforward. Complicated rules. Hard-to-reach redemption thresholds. Lack of transparency about actual value. Research shows 43% of consumers abandon rewards that require more than two steps to redeem, for example, creating an account, downloading an app, and navigating a rewards page.
Economic reality drives the shift
Gen Z came of age during economic whiplash, the late-2000s recession during childhood, COVID-19 as they entered adulthood, and record inflation from 2021-2023. Currently, 46% of Gen Z report living paycheck to paycheck. In this context, immediate cash has exponentially higher value than nebulous future rewards.
Mobile-first expectations demand instant gratification
Gen Z are digital natives who expect everything immediately, wherever they are. Over 85% made a mobile payment in 2023. They’re used to same-day delivery, one-click purchases, and instant communication.
They want their rewards delivered to their phones, usable within seconds, with complete transparency about value. QR codes, mobile wallets, instant notifications- these are baseline expectations, not nice-to-haves.
Transparency isn’t negotiable
Cash rewards are honest. Ten dollars is ten dollars, with no blackout dates or fine print. Points programs, by contrast, often change conversion rates or redemption values, something Gen Z sees as a bait-and-switch.
What this means for brands
Brands that continue pushing points-based programs on Gen Z will see:
- Lower enrollment rates among young consumers
- Higher non-redemption rates (wasted marketing spend)
- Declining engagement and brand loyalty
- Lost market share to competitors offering instant value
Those that embrace instant, flexible rewards will capture the attention and wallets of the most dynamic generation of consumers.
The great cash revolution is here. The question is whether your brand will lead the change or be left behind.
Sources: bankrate.com | i2cinc.com | smartbrief.com | bcg.com | thewisemarketer.com | switchfly.com | investopedia.com | paymentsdive.com | kansascityfed.org | coinlaw.io | trueloyal.com
