Customers producing a plastic card at a retail outlet or airline ticket counter are a familiar sight. Most of us carry several plastic cards to get loyalty points accrued to us for rebates or other benefits in future transactions. Maintaining several plastic cards is obviously cumbersome for customers.

Even for the retailers, cost of issuing and maintaining these plastic cards is proving to be a headache.

All this could be a thing of the past, thanks to the humble mobile phone. A new concept, called mobile loyalty cards, promises to bring much needed relief to the plastic card holders and issuers alike. With the arrival of mobile loyalty cards, customers do not have to go through the pain of carrying different plastic cards with them. Instead, a simple mobile phone could carry the information about different loyalty cards of airlines, hotels and retail outlets.

?Mobile loyalty cards rest on a mobile phone. We fill all the details of the customer on to his mobile phone?name, date of birth, phone number, address and even the customer?s picture. Within three minutes, a mobile loyalty card is created and an ID number is allocated to the customer. Thus, the customers need not carry different plastic cards with them,? says Vineet Narang, CEO, MobiQuest.

Here?s how the concept works. The loyalty card of the customer lies in her mobile phone only and a unique identification number is allotted to the customer after filling in all the details. After every transaction, the customer can produce that loyalty card and thus earn points. And any simple mobile phone can be used for this. To put it simply, customers just have to flash their mobile loyalty card after every transaction and the points will be accrued to them.

Raj Singh, managing director, ActiveMedia Technology says, ?Mobile loyalty cards (MLC) work by turning the mobile into a digital loyalty card. The MLC concept is that a mobile phone can replace traditional loyalty cards. It has a huge potential.?

According to him, there are several problems with the traditional plastic cards, which can be addressed by mobile loyalty cards. These include costs incurred by high issuance and ongoing maintenance costs?lost, damaged and stolen cards. With the arrival of mobile loyalty cards, these can be drastically reduced and it is easy to sign up as well.

Mobile loyalty cards are an easy and attractive solution, instead of giving plastic loyalty cards to consumers. The bigger benefit for the companies is that they don?t have to bear the pain of distributing plastic cards or the writing of details of the consumer on paper and then feeding it into a computer. This had been a long process and it took a lot of time and the cost of production of plastic cards was high too. But with easy to use mobile loyalty cards, it has become convenient and companies do not have to spend a lot of time in collecting customer?s details. Paperwork too is negligible. In addition, it has also become easy to maintain the details of the customers for the companies as well.

Some of the verticals where mobile loyalty cards could find greater use would be retail chains, airlines, coffee chains, restaurants or even oil companies. With a large number of mobile users in the country, the companies can rope in large number of consumers too.

?This product is highly efficient, easy to use and people can adopt it immediately. By means of this medium, product companies can also acquire several customers,? says Narang.

However, the concept is still in its infancy, claims Raj Singh. ?There will be a transition period as the mobile phone becomes the single device that replaces payment and loyalty cards in entirety. This does require changes not only in consumer behaviour, but also on the company?s side. For retail companies, it means upgrading their IT infrastructure to fully interact with the mobile phone in a fast and convenient method, using communication technology,? he adds.

?I would expect mobile loyalty cards to grow faster in India than in other more mature markets. This is due to the good penetration of mobile phones and low usage of plastic cards. As a mobile loyalty card is an efficient and convenient platform to deliver a loyalty programme, it is the increase in loyalty programmes per se that will drive the growth of mobile loyalty cards,? informs Raj Singh.