Guide
Loyalty card fraud, and what to do about it
Every loyalty programme leaks. Most owners have never measured how much, which is why the number is usually a surprise. This is where it goes, and what is worth doing about it.
· 6 min read
How paper cards leak
Punch cards are punched by friends, borrowed, photocopied and completed with a stationery-shop punch that matches yours closely enough. Stamps are worse: a rubber stamp is easy to source and impossible to distinguish. Most cafés running paper accept a level of loss they have never quantified, and when they eventually measure it after switching, the figure is typically well above what they assumed.
The bigger source is not fraud at all
Far more value leaks through ordinary kindness: a barista adding two stamps because someone waited, rounding up for a regular, or completing a card for a customer having a bad day. Individually these are good service. Collectively they are a discount nobody decided on. The point of measuring is not to stop it — some of it is the best marketing you have — but to know it is happening and choose the level deliberately.
Why attribution works better than rules
Every stamp recording who added it, where and when changes behaviour more effectively than any policy, and without anyone being accused of anything. Nobody has to be told off; the pattern is simply visible. If one staff member issues three times the stamps of everyone else on the same shifts, that is a conversation — which might end in training, or in discovering they are your best salesperson.
Practical controls worth having
A cap on stamps per customer per day removes the obvious abuse — the friend who scans the same card eight times — without affecting a single honest transaction. Requiring staff to be signed in as themselves means attribution is real. And rewards being redeemable only by a staff member, rather than self-served by the customer, closes the gap where a screenshot becomes a free coffee.
What digital does not fix
It is worth being straight: a member of staff who wants to give their friend ten stamps can still do it, and no software prevents that. What changes is that the action leaves a record with their name on it. Digital converts undetectable loss into visible loss, which is a large improvement and not the same thing as elimination.
Questions
- Can customers screenshot a reward and reuse it?
- Not where redemption is staff-controlled. The reward is spent on your side when a staff member hands it over, so an image of a full card is just an image.
- Should I cap stamps per day?
- Usually yes, at a number slightly above your most enthusiastic genuine customer. It costs honest customers nothing and removes the simplest form of abuse.
- How do I raise this with staff without accusing anyone?
- Show the numbers rather than the suspicion. "Stamps per shift vary a lot between us, let us agree a rule" is a conversation. "I think someone is cheating" is an argument, and usually a wrong one.
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