Need to Know
- JPMorgan has purchased cxLoyalty’s technology platforms and full-service travel agency, as well as its gift card, merchandise, and points bank businesses.
- Half of cxLoyalty’s 3,100 employees will move to a new retail division within JPMorgan.
- cxLoyalty Group has 3,000 clients and marketing partners serving 70 million consumers.
JPMorgan is betting travel will bounce back in 2021, demonstrating its confidence in the return of the industry with the acquisition of the rewards and points divisions of cxLoyalty, the third-party credit card loyalty operator.
The bank will acquire the technology platforms, travel agency, gift card, and points businesses of cxLoyalty Group, with Marianne Lake, head of JPMorgan’s consumer lending business, saying the acquisition was made largely to give the bank a leg up when consumers return to leisure travel this year.
“People across the globe want to vacation and travel again, and hopefully that will become a reality for many in the near future,” Lake said in a statement to CNBC. “Acquiring the travel and rewards businesses of cxLoyalty will provide enhanced experiences to our millions of Chase customers once they are ready, comfortable and confident to travel.”
Half of cxLoyalty’s 3,100 employees will move over to JPMorgan, to work for a new business within the bank’s retail division. The acquisition will close this week, but no financial specifics have been made available.
“We are pleased to announce this compelling transaction, which provides significant benefits for our clients, customers, employees and other stakeholders. We have built two strong, distinct businesses, and we look forward to enhancing their focus on their unique strategic priorities and market opportunities,” Todd Siegel, CEO of cxLoyalty Group Holdings, said in a statement. “We anticipate the transition to be seamless. Our employees have worked tirelessly to achieve this milestone, and thanks to their efforts we are positioning both cxLoyalty and the Global Customer Engagement Division for an even stronger future.”
JPMorgan has history with cxLoyalty: the bank first partnered with the company for its credit card rewards program until switching to Expedia in 2018. JPMorgan now plans to return to cxLoyalty as the tech platform behind its travel program; by gaining cxLoyalty’s technology, JPMorgan will own both ends of a two-sided platform, and will eventually be able to offer unique deals to credit card users who have direct relationships with hotel and airline companies.
cxLoyalty Group claims to have 3,000 clients and marketing partners serving 70 million consumers. The company currently serves major credit cards including Citigroup, Capital One, and Mastercard.
The acquisition of cxLoyalty marks a strong start to the year for JPMorgan and continues on last year’s trend of strong innovation for the bank. In addition to the creation of its own blockchain unit and the launch of its QuickAccept card reader, JPMorgan also announced plans last year to allow businesses to swap loyalty points for a standardized, exchangeable currency.