Santander ends its reward checking program
Santander Bank N.A. is ending a checking account rewards program that the Spanish bank launched in 2013 as part of a rebranding effort to grab a larger share of the US market.
The move comes as Banco Santander trims costs worldwide. The bank plans to close more than 400 branches in Spain and layoff more than 1,000 employees, according to news reports.
Santander, which has its US headquarters in Boston, is sending letters to its extra20 account customers in the coming weeks notifying them that they will be moved into a different checking account product without a rewards program starting in July.
By the end of this year, the bank will no longer have any extra20 accounts, which allowed customers to earn $240 annually if they conducted certain transactions with the bank, said Michael Cleary, Santander’s head of consumer and business banking.
Cleary declined to say how much the rewards program cost the bank. But about 16 percent of its customers participate in that checking account.
The bank launched extra20 to lure customers when it formally changed its name in the US to Santander, from Sovereign Bank. Ultimately, the account may not have worked as well as the bank had hoped. Santander’s market share in Massachusetts decreased from 6.4 percent of deposits in 2013 to under 5 percent last year.
The bank is prepared to lose some of its customers as a result of the change, but most will stay because they like the service or other products, he said.
“People choose a bank still for convenience,” he said. “If we treat our customers right, they won’t leave for this. Most don’t join for the bonus, per se.”