Innovation in service vouchers to support the social economy

March 22, 2023

Originally developed in France, service vouchers and service cards began as a way for employers to offer employees the option to purchase items such as restaurant meals, groceries, clothing and school books at discounted rates thanks to tax incentives. Over time, the service voucher and service card industry has expanded to provide not only a host of food, cultural and leisure-related services, but also welfare benefits allocated by public authorities.

In the employee-employer context, service vouchers have been cited as a successful way to improve both company performance and employee well-being. This is primarily through the benefits provided to employees, which optimize working conditions, total compensation and enhance loyalty, all while facilitating access and cost-optimizing essential services such as food, childcare and certain health services. Vouchers and cards can also be used to help companies manage and control expenses such as company car maintenance, uniform cleaning or housing management.

In the social program context, service vouchers can help local authorities and public institutions to equitably allocate government assistance and benefits, while providing a transparent way to monitor spending. Service vouchers are also used in the context of incentive programs for customers. This can include gift cards with a prepaid amount of credit that are redeemable at specific stores or restaurants, or promotional vouchers distributed by companies to reward customer loyalty or increase brand awareness. The industry has grown significantly over the last two decades, and the global market for service vouchers and service cards has been valued at over €80 billion.

Innovations in the industry have to date focused on R&D in card technology, data processing, security and control systems, as well as increasingly personalized vouchers. Moving from a paper-based business model to one that is now mostly digital, with increasing technology to support secure and contactless transactions, the industry is well-poised for further growth, particularly in partnership with social economy stakeholders such as charities, associations, foundations, cooperatives and social impact entreprises.

How could this work in practice? First, charities and associations can work with an experienced provider of service vouchers and cards to create tailored programs that are customized to reflect their individual needs. For instance, this may include setting up card programs so that individuals that are supported by the associations may access basic services, in addition to rewarding volunteers and service providers to the charities.

Another way that service vouchers and cards can be used to support the social economy is through partnerships between banks, corporates and small-scale enterprises. This could involve a bank setting up a loyalty program to reward customers who purchase products or services from a social impact entreprise. Additionally, companies may choose to offer discounts to customers that hold charity-issued discount cards.

Finally, service vouchers and cards can be used in combination with other forms of payment such as mobile payments and digital wallets to open a range of payment solutions and facilitate secure transactions. For example, a social enterprise could set up a loyalty program that rewards customers for using their digital wallet, or use vouchers and cards to facilitate remittances and other payments in foreign currencies.

Overall, service vouchers and cards present significant innovative potential in the social economy sector, where service vouchers can be used to provide essential services, reward volunteers and staff members, build customer loyalty programs that support small-scale enterprises and facilitate cross-border payments. With the right partnerships between financial institutions, corporates and non-profit organizations, the use of service vouchers and cards has the potential to revolutionize the way that transactions are carried out in the social economy, as well as more broadly.

CPM