What Is a Wallet-Based Loyalty Card? | Small Business Guide
Feb 7, 2026
You've probably noticed something happening over the last few years: your boarding passes don't print anymore. Your concert tickets aren't physical. Your gym membership lives on your phone. Even your Tesco Clubcard and Costa Coffee loyalty card have migrated into your phone's wallet app.
That's not an accident. It's a fundamental shift in how people carry and manage information—and it's completely changed what loyalty programs can do for small businesses.
If you run a barbershop, a café, a beauty salon, or any other small business that relies on repeat customers, you've probably wrestled with this question: How do I run a loyalty program that actually works without spending a fortune on custom apps or drowning in paper cards?
The answer is wallet-based loyalty cards—digital loyalty cards that integrate directly into Apple Wallet and Google Wallet. They're not apps. They're not plastic cards. They're something simpler, more powerful, and increasingly essential for any business that wants to keep customers coming back.
This guide will explain exactly what wallet-based loyalty cards are, how they work, why they're replacing both paper cards and loyalty apps, and whether they're right for your business.
What Is a Wallet-Based Loyalty Card?
A wallet-based loyalty card is a digital loyalty program that lives inside your customer's existing digital wallet—Apple Wallet on iPhones or Google Wallet on Android devices.
Here's what makes it different from everything else:
It's not an app. Customers don't download anything. They don't create an account. They don't remember a username or password. The loyalty card just... exists. Right there in the wallet app that's already on their phone, sitting next to their bank cards and travel passes. On iPhones, that means sitting inside Apple Wallet alongside bank cards and boarding passes, accessible with a double-click of the side button—no app icon to hunt for, no login screen to navigate.
It's not a website. Customers don't need to log into a portal or remember a URL to check their points. The card displays their current progress—stamps earned, points accumulated, rewards available—right on the card itself.
It's not paper. There's nothing to print, laminate, or keep behind the counter. Nothing for customers to lose, forget, or accidentally put through the wash. The card is digital, always accessible, and synced to their account automatically.
Think of it like this: a wallet-based loyalty card is to loyalty programs what contactless payment is to cash. Same fundamental purpose (rewarding customers), but executed in a way that actually fits how people live in 2026.
How Wallet-Based Loyalty Cards Actually Work
Let's walk through the mechanics from both sides—what the customer experiences and what you, as the business owner, need to do.
The Customer Experience
Adding the card (happens once):
Customer visits your business
You show them a QR code or send them a link (via text, email, or even just verbally: "Search for [your business] loyalty card")
They scan the QR code or tap the link
The loyalty card adds to their Apple Wallet or Google Wallet instantly
Total time: about 10 seconds Most businesses find that a QR code at the checkout counter converts best because customers can scan it in the moment, while they're already engaged and standing right in front of you.
Using the card (happens every visit):
Customer makes a purchase
You scan their loyalty card using a scanner app on your phone or tablet
Their card updates in real-time—new stamp appears, points increase, progress bar moves forward
They see the update happen on their phone immediately
Redeeming rewards:
When they reach a reward threshold (e.g., 10 stamps, 100 points), their card shows a "Redeem" badge
They show you the card at checkout
You process the reward and reset the card for their next cycle
Getting notifications:
The customer receives push notifications directly to their lock screen
No email, no SMS costs, no app required
Notifications appear alongside texts and WhatsApp messages, so they're impossible to miss
The Business Experience
Setting up the program (happens once):
Choose a wallet-based loyalty platform (like Perkstar)
Design your loyalty card—add your logo, colors, branding
Decide on your reward structure (stamps, points, membership, etc.)
Generate a QR code or link to share with customers
Issuing rewards (happens every transaction):
Open your scanner app after the customer pays
Scan the loyalty card on their phone
The system logs the transaction automatically
Takes about 2 seconds
Communicating with customers:
Send push notifications to all loyalty members (or specific segments)
Remind them they're close to a reward
Announce special offers or seasonal promotions
Unlimited notifications, completely free
Tracking performance:
View real-time analytics: how many active members, redemption rates, average visit frequency
Segment customers by behavior (frequent visitors vs. lapsed customers)
Export data for further analysis or marketing campaigns
The entire system is designed to be frictionless for customers and effortless for you. That's the point. If your loyalty program requires staff training, interrupts checkout flow, or confuses customers, it won't get used. Wallet-based loyalty cards integrate seamlessly into how people already behave.
The Three Loyalty Approaches: Paper, Apps, and Wallet-Based
Most small business owners have tried one of these at some point. Let's compare them honestly.
Paper Loyalty Cards
How they work: You print cards, stamp or punch them at checkout, customers bring them back to redeem rewards.
Pros:
Dead simple to understand
No technology required
Low upfront cost
Cons:
Loss rate is staggering. Industry estimates suggest 30-40% of paper cards are lost, damaged, or forgotten before completion.
Zero communication. Once you hand over the card, you have no way to reach the customer until they come back.
No data. You have no idea how many people are actually using your loyalty program or which customers are your most valuable.
Ongoing costs. Printing, reprinting when cards run out, replacing lost cards, plus the staff time managing physical cards.
Environmental waste. Most cards never get completed and end up in bins.
Verdict: Paper cards worked for decades, but they're fundamentally broken. Too much friction, too many lost opportunities.
Loyalty Apps
How they work: You build or buy a custom app. Customers download it, create an account, and track their rewards inside the app.
Pros:
Branded experience—the app is yours
Full control over features, design, and functionality
Can include extra features like booking, menus, or product catalogs
Cons:
Horrible adoption rates. Most customers won't download an app for a single business. You're asking them to give up phone storage, create yet another account, and remember yet another password.
Expensive. Custom app development costs £10,000-£50,000+. Even white-label solutions cost £100-£500/month. When you compare loyalty apps versus Apple Wallet cards side by side, the adoption gap is stark: wallet-based cards typically see 60-70% enrollment rates compared to 5-15% for standalone apps.
Ongoing maintenance. Apps need updates, bug fixes, and compatibility maintenance every time iOS or Android releases an update.
App fatigue is real. People are actively deleting apps to free up space. Asking them to download yours is a tough sell unless you're Starbucks or McDonald's.
Push notifications require permission. Many users deny notification permissions during app install, so you lose that communication channel anyway.
Verdict: Apps make sense for large chains with budgets and brand loyalty. For small businesses, they're overkill and underutilized.
Wallet-Based Loyalty Cards
How they work: Customers add your loyalty card to Apple Wallet or Google Wallet (the apps already on their phone). No downloads, no accounts, no friction.
Pros:
Instant adoption. No app to download. Adding a card takes one tap. Customers already know how to use their wallet app. On the Android side specifically, Google Wallet loyalty cards for businesses now offer the same seamless experience as Apple Wallet—same one-tap setup, same lock screen notifications—which means you're not excluding the roughly 50% of UK smartphone users on Android.
Always accessible. The card sits in their digital wallet next to their bank cards. They can't forget it or leave it at home.
Push notifications built-in. You can send unlimited free notifications that appear on their lock screen—no SMS costs, no email open rates to worry about.
Full analytics. Track everything: active members, redemption rates, visit frequency, customer segmentation. For a deeper look at how these cards are becoming the new standard for small businesses, including real adoption data and cost breakdowns, it's worth understanding why this approach consistently outperforms both paper and app-based alternatives.
Affordable. Platforms like Perkstar start at £15/month—less than the cost of printing paper cards or building an app.
No maintenance headaches. The platform handles updates, compatibility, and infrastructure. You just manage your loyalty program.
Cons:
Less customization than apps. You can't add booking features, menus, or catalogs. It's purely a loyalty card.
Requires a digital loyalty platform. You can't DIY this—you need a service like Perkstar to handle the wallet integration.
Verdict: Wallet-based loyalty cards hit the sweet spot for small businesses. All the benefits of digital loyalty without the cost, complexity, or adoption barriers of apps.
Why Wallet-Based Loyalty Is Now the Default for Small Businesses
Five years ago, wallet-based loyalty was niche. Today, it's becoming standard. Here's why:
1. Digital Wallets Are Ubiquitous
Apple Wallet launched in 2012. Google Wallet (formerly Google Pay) launched in 2011. For over a decade, tech companies have been training consumers to put everything in their digital wallets—boarding passes, event tickets, hotel keys, loyalty cards.
The result: Customers already know how to use their wallet app. There's zero learning curve. When you ask them to "add this to your wallet," they know exactly what you mean.
The numbers: As of 2026, over 60% of UK smartphone users actively use Apple Wallet or Google Wallet. That's not early adopters—that's mainstream.
2. App Fatigue Is Real
The average person has 40-80 apps installed on their phone. They actively use about 9 per day. Every new app you ask them to download competes with Instagram, WhatsApp, TikTok, and every other service fighting for their attention. That's exactly why more businesses are exploring loyalty software alternatives to apps—solutions that deliver the same digital experience without asking customers to sacrifice phone storage or create yet another account.
The reality: Most people won't download an app for a single café, barber, or salon. It's too much friction for too little benefit. But adding a card to their existing wallet app? That's easy. That's one tap.
3. Push Notifications Actually Work
Email open rates for small businesses average 15-20%. SMS marketing costs 5-10p per message and feels invasive. But push notifications from wallet-based loyalty cards? They appear on the lock screen for free, and open rates hover around 30-40%.
Why they work: Because customers opted in. They added your card voluntarily. They want updates. When you send a notification saying "You're 2 stamps away from a free coffee," they're not annoyed—they're reminded of something they value.
4. Small Businesses Need Cost-Effective Solutions
Between rising rents, increased wages, and economic uncertainty, small businesses are operating on tighter margins than ever. Spending £10,000 on an app or £500/month on a white-label solution doesn't make sense for most independent operators.
Wallet-based loyalty platforms cost £15-£60/month. That's less than what you'd spend on printing paper cards, and you get analytics, automation, and unlimited push notifications included.
5. Customers Expect It
Walk into any modern café, barber, or salon, and customers now expect a loyalty program. It's no longer a competitive advantage—it's table stakes. But they also expect it to be convenient. Asking them to carry a physical card or download an app feels outdated.
Wallet-based loyalty meets customer expectations without creating friction. It's digital, it's always accessible, and it works the way they're already used to.
Real-World Example: How a Salon Switched from Paper to Wallet-Based Loyalty
Let's look at a practical case study.
The Business: A beauty salon in Bristol offering nails, waxing, facials, and brows. Three staff members, about 150 clients per month.
The Old System (Paper Cards):
Printed 500 paper punch cards at a time (cost: £50)
Clients got one punch per treatment, 10 punches = free express facial (£30 value)
Cards kept behind reception to avoid clients losing them
Staff manually punched cards at checkout
The Problems:
Clients frequently forgot to ask for their card at checkout
When cards got damaged or lost, there was no record of progress—clients had to start over
No way to communicate with clients between visits
No data on redemption rates, active members, or program ROI
Staff spent time managing physical cards instead of focusing on clients
The New System (Wallet-Based):
Switched to Perkstar in January 2026
Created a digital stamp card: 8 treatments = free express facial
Sent existing clients a text message with a link to add the loyalty card
New clients shown a QR code at reception: "Want to join our loyalty program? Scan this."
Staff scan loyalty cards at checkout using an iPad (takes 2 seconds)
What They Did Differently:
Automated milestone reminders: When a client hit 5 stamps, they got a push notification: "You're 3 treatments away from a free facial! This kind of transformation isn't unique to one salon—across the industry, barber and salon loyalty programs that move from paper to digital consistently see higher retention rates, better rebooking frequency, and measurable ROI within the first quarter."
Birthday rewards: The system automatically sent a notification on clients' birthdays offering a free brow tint
Lapsed customer reminders: Clients who hadn't visited in 6+ weeks got a gentle nudge: "We miss you! Book your next treatment and earn your next stamp."
Seasonal promotions: Before Christmas, the salon sent a push notification: "Holiday pamper time? Book a facial and earn double stamps this week."
The Results After 4 Months:
65% adoption rate. Two-thirds of clients added the digital loyalty card within the first month.
28% increase in rebooking rate. Push notifications reminded clients to return before they drifted away.
35% reduction in admin time. No more managing physical cards or dealing with "I lost my card" conversations.
£180 increase in average client lifetime value. Clients who joined the loyalty program spent more over 6 months than those who didn't.
Zero printing costs. The salon saved £50 every few months on card reprints.
What the Owner Said: "The difference is night and day. With paper cards, we were guessing. Now we know exactly how many active loyalty members we have, how often they're visiting, and which rewards actually drive bookings. The push notifications alone have been worth it—clients rebook faster, and we're not paying for SMS or email campaigns."
Modern Take: Why 2026 Is the Year Small Businesses Go Wallet-Based
Here's the shift that's happening right now—and why wallet-based loyalty has reached a tipping point:
1. Inflation Changed Customer Behavior
With the cost-of-living crisis, customers are being more intentional about where they spend. They're consolidating around businesses they trust and cutting out the rest. A loyalty program gives them a rational reason to stick with you instead of shopping around for cheaper alternatives.
But here's the key: they won't stick around if your loyalty program is inconvenient. Paper cards get lost. Apps don't get downloaded. Wallet-based loyalty removes the friction, so customers actually use it.
2. Small Businesses Can Finally Compete on Experience
For years, loyalty programs were the domain of big chains with big budgets. Starbucks could afford to build an app. Your independent café couldn't. That created an uneven playing field.
Wallet-based loyalty platforms leveled it. Now, a single-location barbershop can offer the same seamless digital loyalty experience as a national chain—for £15/month. You're competing on experience, not budget.
3. Privacy Concerns Are Shaping Customer Expectations
Customers are increasingly wary of giving out their data. Downloading an app means accepting terms and conditions, granting permissions, and handing over personal information. Many people refuse on principle.
Wallet-based loyalty cards require minimal data—usually just a phone number or email to tie the card to a customer profile. No invasive permissions, no data harvesting, no creepy tracking. That makes customers more willing to join.
4. AI and Automation Are Making Loyalty Effortless
The early days of digital loyalty required constant manual work—sending emails, tracking points, managing rewards. Modern wallet-based platforms use automation and AI to handle the grunt work.
Examples:
Automated birthday rewards (no need to remember or manually send offers)
Behavior-based notifications (e.g., clients who haven't visited in 4 weeks automatically get a reminder)
Predictive analytics (platforms can suggest optimal reward structures based on your business type and customer behavior)
You set the rules once, and the system runs itself. That's why wallet-based loyalty is scalable for small businesses with limited staff.
How to Set Up a Wallet-Based Loyalty Card (The Simple Version)
If you're ready to switch from paper cards or try loyalty for the first time, here's the straightforward path:
Step 1: Choose Your Platform
You need a wallet-based loyalty platform that integrates with Apple Wallet and Google Wallet. Platforms like Perkstar handle all the technical infrastructure—wallet integration, push notifications, analytics—so you don't need any coding or technical skills. If you want to compare what's available beyond Perkstar, a breakdown of the best digital loyalty card software options for small businesses will help you evaluate pricing, card types, and platform limitations before you commit.
What to look for:
Easy card design tools (drag-and-drop builders)
Scanner app for iOS and Android
Push notification capability (unlimited and free)
Analytics dashboard
Fair pricing (£15-£60/month for most small businesses)
Step 2: Design Your Loyalty Card
Most platforms offer templates. Customize yours with:
Your logo and brand colors
A hero image (photo of your business, product, or team)
Reward structure (e.g., 10 stamps = free service, or If you're unsure whether to go with a stamp-based approach or a tiered membership model, the choice depends on your visit frequency and average transaction value—understanding the difference between membership cards and stamp cards will help you pick the structure that actually drives repeat visits for your business type. 1 point per £1 spent)
Clear reward description
Design tip: Keep it clean. The card will display on a small phone screen, so avoid clutter. Use high-quality images and limit text to essentials.
Step 3: Decide How Customers Join
You have several options:
QR code at checkout: Print a small sign with a QR code and the headline "Join our loyalty program—scan to add your card."
Text message link: After a transaction, text customers: "Thanks for visiting! Join If you're leaning toward the QR code route—and most businesses do—it's worth understanding how QR code loyalty programs actually work end to end, since the placement, size, and call-to-action on your sign all affect how many customers scan it. our loyalty program: [link]"
Website integration: Add the sign-up link to your website, Instagram bio, or Google Business profile
In-person sign-up: At checkout, ask: "Want to join our loyalty program? I'll scan your phone real quick."
Step 4: Train Your Team (Takes 5 Minutes)
Show staff how to scan loyalty cards:
Open the scanner app on your phone or tablet
When a customer pays, say: "Can I scan your loyalty card?"
Customer opens their wallet app and shows the card
You scan the QR code on their card
Stamp or points added instantly
That's it. The whole process takes 2-3 seconds and doesn't slow down checkout.
Step 5: Promote the Program
Send an email or text to your existing customer list:
"We've launched a digital loyalty card! Add it to your phone and start earning rewards. Every [X] visits, you get a free [Y]. Join here: [link]."
Post about it on social media with a clear CTA and the sign-up link.
Mention it at checkout for the first month: "By the way, we've got a loyalty program now. Want to join? Takes 10 seconds."
Step 6: Use Push Notifications Strategically
Once customers join, use push notifications to drive behavior:
Milestone reminders: "You're 2 stamps away from a free coffee!"
Lapsed customer nudges: "We haven't seen you in a while—miss you!"
Seasonal offers: "Double points this weekend only!"
Birthday rewards: "Happy birthday! Here's a free [reward] on us."
Golden rule: Don't spam. One or two notifications per month is helpful. Five per week is annoying.
When Wallet-Based Loyalty Might Not Be the Right Fit
Let's be honest about limitations. Wallet-based loyalty isn't perfect for every business.
1. Your Customers Don't Have Smartphones
If your customer base skews very elderly or operates in areas with low smartphone adoption, wallet-based loyalty might not work. That said, UK smartphone ownership is over 80% across all age groups, including 65+, so this is less common than you'd think.
Alternative: Offer a hybrid system—digital cards for most customers, manual tracking for the few who prefer it.
2. You Need Deep Customization
Wallet-based loyalty cards are loyalty cards. They're not booking systems, menu apps, or e-commerce platforms. If you need a fully customized solution with multiple features integrated, you might need a custom app (though that comes with significantly higher costs and complexity).
Alternative: Use wallet-based loyalty for rewards and integrate other tools (booking software, e-commerce) separately.
3. You're Not Ready to Manage Customer Data
Wallet-based loyalty platforms collect customer data—names, phone numbers, visit frequency. If you're not prepared to manage that responsibly (GDPR compliance, data security), hold off until you're ready.
Alternative: Most platforms (including Perkstar) handle GDPR compliance for you, so this shouldn't be a blocker. Just make sure you understand your obligations.
Final Thought
Wallet-based loyalty cards are what loyalty programs should have been all along: simple, effective, and built around how people actually live.
They don't require customers to download anything, remember anything, or carry anything extra. The loyalty card just exists—always accessible, always up-to-date, always working.
For small businesses, they're a rare win: a technology that makes your life easier while making your customers happier. They're affordable, low-maintenance, and genuinely drive results.
If you've been putting off loyalty because apps felt too expensive or paper cards felt outdated, wallet-based loyalty is the answer. It's not complicated. It's not a gamble. It's just a better way to reward the people who keep coming back.
Ready to try it? Start a free 14-day trial with Perkstar—no credit card required. Design your first wallet-based loyalty card, share it with a few customers, and see what happens. You could have your first loyalty members by tomorrow.
