Building a global loyalty network on blockchain

By Foo Boon Ping

Hana Financial Group has launched an ambitious global initiative to create a shared-loyalty platform that is built on blockchain technology. The group’s deputy president Han Jun-Seong explains

To leverage its global presence and digital leadership, Hana Financial Group (HFG) recently launched the Global Loyalty Network (GLN) initiative, which it described as “a cross-border platform that allows the use and exchange of virtual currencies by connecting various loyalty programmes in each country with a wide network of global partnership platforms”.

Han Jun-Seong, deputy president, Hana Financial Group

Han Jun-Seong, the bank group’s deputy president and group chief innovation and information officer, explained: “GLN is a one-stop programme for all virtual currencies, on a single platform with global usability. It leverages the latest in distributed ledger technology or blockchain, the convenience and user experience of the smartphone and a global rewards and loyalty platform to provide a universal network for value exchange.”

HFG aims to capitalise on its global operating footprint in 24 countries and its own loyalty programme, “Hana Members”, which serves over ten million customers to kick-start this global programme.

GLN International across North America, Europe and Asia

The bank has set up an independent subsidiary called GLN International to build the underlying infrastructure for the platform and to market and sign up global partners and members, primarily in 25 countries across North America, Europe and Asia that it had identified.

The programme will utilise virtual currencies as the medium of storage and exchange of value in the form of reward points, mileages or coupons as well as digital money that is backed by financial institutions which are issued to the users or customers of the programme.

Han remarked: “It will facilitate and ensure interoperability and wider coverage in acceptance across different geographies, including cross-border location, as well as through different transaction channels. This is in recognition of the increasing demands and needs of travellers and their desire for special benefits and various value-added services on their overseas spending.”

The programme seeks to create a global alliance with leading financial institutions, retailers, and loyalty programme providers. It will share service resources provided by each partner in its local market and allow customers who spend overseas through the network to access personalised coupons and reward points (in the form of virtual currencies) which can be earned and redeemed, swapped, topped up and even transferred or gifted to others. The global network will be connected by blockchain technology. Han explained that this will be more cost effective and secure than conventional technology.

The GLN mobile app

The functions of GLN which are accessible through a mobile app include online and offline payments, global remittances, a coupon mall, and the ability to swap and exchange various virtual currencies available within the network.

The key service features of GLN

Source: Hana Financial Group

It facilitates point of sale (POS) payments through various methods such as barcode, quick response (QR) code and near field communication (NFC), as well as offline features that incorporate location based and augmented reality services to enable customers to access merchant offers which they can earn and redeem reward points. In addition, the GLN app provides a means of real-time cross-border transfer of different forms of virtual currencies of its GLN partners as well as conventional currencies. The platform enables the interoperability of the various virtual currencies through swaps and exchanges.

Customers can also download digital coupons from the app’s coupon mall to access discounts and other benefits from a range of partner GLN merchants such as airlines, hotels, departmental stores and restaurants. It offers a global marketing and usage platform for merchants.
Each GLN partner can select and customise the GLN features according to its customer preferences and regulatory requirements. The customers in turn can experience integrated and seamless benefits regardless of their location and payment method.

The programme aims to reward overseas spending through these globally supported services. By sharing each participating partner’s loyalty programme, it aims to provide unique experiences for customers when they travel. In addition, partners of the programme will also share profits arising from various transactions within the network

Han commented: “GLN partnership will take many forms depending on each prospect’s current infrastructure and local market situation. For financial institutions and banks, the primary role is to organise and manage the local business and virtual currency network which involves authorisation and settlement of transactions between GLN partners. It will also include the conduct of joint customer marketing and promotion activities.”

Banks can join GLN as direct partners, through a joint-venture with other banks in their local market or as an equity investor in GLN International.
Since its inauguration in November 2017, the programme has signed up a number of major financial institutions, retailers, ecommerce players and loyalty programme providers in the region such as Taishin International Bank of Taiwan, a leading credit card issuer; Siam Commercial Bank of Thailand and the country’s leading retailer Central Group; leading Chinese online travel portal Ctrip as well as a joint venture of Japanese community banks.

This is an undoubtedly ambitious programme and it will be interesting to see how GLN International is able to sell the concept to global and regional players with competing interests and disparate infrastructure to come together to share resources and benefits. With the number of major partners that it has managed to sign up so far, it has nevertheless appeared to have gotten off to a good start.

Keywords: Cryptocurrency, Global Loyalty Network, QR Code, POS, Mobile Banking
Institution: Hana Financial Group


Diary of Activities
UAE Innovation Study Tour 2019
17 - 21 March 2019 | UAE
The Future of Finance West Africa 2019
23 - 25 April 2019 | Nigeria
Wealth & Society West Africa 2019
25 April 2019 | Nigeria
Thailand Innovation Study Tour 2019
27 - 29 May 2019 | Thailand