An electronic gift card that is currently accepted at 65 local retailers, service providers and restaurants may bring significant new money into the local marketplace this Christmas, according to the entrepreneurs who launched the card one year ago.

Richard Simon, who launched the gift and reward card company Incentis Ltd. last year with partner Alvin Wilson, is trying to spread the word that the payback gift card is a sensible present for overseas relatives to purchase Island residents.

"Sending and receiving gifts to Bermuda is a hassle," he said adding that residents are often forced to pay duty on gifts they might not want or like. Those who receive gift cards however ? which may be purchased online at the company's website ? do not have to pay duty and also have a choice of venues where they can spend the cash.

"They can spend it where they want be it spas, movies, restaurants, fashion or travel even pest control. They can have their cess pit cleaned. We have all kinds of merchants and it is really the perfect gift because the local person can buy what they want with it and don't have to pay duty," Mr Simon said.

He insists that his mother who lives overseas buy a card when she wants to purchase gifts for her five-year-old daughter.

While the cards are clearly a business venture for Incentis Ltd., which takes an administrative fee upwards of $7 with each card sale to cover the cost of the card package, a commission for the merchant selling the card, debit and credit card fees and card processing costs, the cards have won favour with the Buy Bermuda campaign and the 65 local businesses participating in the programme. After all, Mr. Simon points out, the gift cards ensure that money that might never have been spent in Bermuda will now be spent locally.

"If hundreds or thousands of people overseas send cards in lieu of gifts it is all new money flooding into local economy so for the retailers who have been battered, it is new money coming in and it is not coming out of any local person's pocket," he said.

Incentis also recently launched The Payback Loyalty Card which ensures that the same participating merchants reward customers for frequenting their business. The idea of rewarding customers for their business has surprised and pleased many customers, Mr. Simon said while giving the businesses an edge over competitors ? shoppers are likely to frequent the shop that rewards them.

Under the marketing programme, each merchant can set the percentage of cash back they want to offer customers. While some opt to offer the minimum of just half a percent back others such as Hunts and A.S. Cooper are offering a full five percent back on every purchase.

Mr. Simon said the company opted to offer the rewards in cash rather than as airmiles as has been done through similar programmes in other jurisdictions because it is simpler.

"They give you thousands of miles which are worth next to nothing. That is why when we created our programme we designed it in dollars and cents to make it clear. When you get 50 cents, it doesn't sound like a lot but at least you know exactly what you have to spend and that 50 cents can be spent at any of our 65 locations and gets you 50 cents of product or service," Mr. Simon said.

Money the customers earn on the card is instant spending money that they can spend with any merchant in the programme.

"If you buy furniture for $5,000, you might earn $50.

"You could walk out of the furniture store and have lunch with your family or whatever," Mr. Simon said adding that the company is also offering other versions of reward cards such as a corporate card which allows employers to reward employees with payback cash cards.

"They reward the employee with cash on company card and the employee has to spend the money locally with one of 65 merchants.

"That has the potential to be huge in terms of dollars locally," Mr. Simon said.