Affinity Capital Exchange (ACE), a fintech innovator in the loyalty finance space pioneering a new class of loyalty points, today announced that it has entered into an agreement with J.P. Morgan (NYSE: JPM). The two firms will work together to provide issuers of loyalty programs the ability to augment secured debt financing by deploying a new class of loyalty points.
Leveraging ACE’s proprietary technology, J.P. Morgan will offer clients a new way of securing and enhancing loyalty financing by using standardized loyalty points, known as Reserve Points. ACE has developed the structure behind these points, which allow loyalty programs to issue points that can be exchanged for any type of point within its program. Over time, these standardized loyalty points will also benefit the operating partners in addition to the issuer.
"We are always looking for innovative ways to help our clients think strategically about their businesses and create value," said Jim Casey, Global Co-Head of Investment Banking, J.P. Morgan. "With ACE, we have the potential to provide our clients and their operating partners a unique opportunity to generate value together, while also enabling access to a wider investor base."
Airlines, hotels, and other loyalty operators will now be able to strategically utilize the value of loyalty programs to raise capital from lenders, institutional investors, and operating partners. In January 2020, industry analysts1 pegged the combined value of the top 100 airline loyalty programs at approximately $200bn.
"We are thrilled to work with J.P. Morgan to provide compelling solutions that match the liquidity needs of loyalty program owners with the interests of their operating partners and demand from lenders and investors," said Atanas Christov, Founder and CEO of ACE. "Combining ACE’s technology with J.P. Morgan’s global scale creates an unmatched value proposition for clients, providing flexible new products that fit the needs of lenders, investors and operating partners for security in return for fresh liquidity to critical businesses."
About Affinity Capital Exchange
Based in New York City, Affinity Capital Exchange (ACE) is a fintech innovator in the loyalty finance space. ACE is building the world’s first technology solution and venue for the issuance and trading of a new class of loyalty points, enabling the creation of financial instruments backed by loyalty point portfolios. Through financial innovation that is supported by tried-and-tested market infrastructure and technology, ACE aims to revolutionize the loyalty economy by bringing the benefits of financial markets to loyalty in a way that respects the unique needs of the industry. Its technology and market platform will provide new solutions to members, initially focusing on generating collateral and attracting liquidity. For more on ACE, please visit afcx.co
Source: 1OnPoint Loyalty ‘Top 100 Most Valuable Airline Loyalty Programs’ report, Jan 2020
Corporate Affairs, Affinity Capital Exchange
Executive Director, Communications, J.P. Morgan