"Let's connect our programmes" is an easy sentence in a partnership meeting and a much harder thing to actually operate. Two loyalty teams agree in principle that members should be able to move points between their programmes, shake hands on a rough exchange rate, and then discover — usually a few weeks into implementation — that the commercial agreement was the easy part.
The exchange rate is a negotiation, not a formula
The instinct is to set the exchange rate based on each programme's nominal redemption value — if your point is worth 0.05 AED and theirs is worth 0.02 AED, the rate is 1:2.5, done. In practice this only works if both programmes' points are equally easy to redeem. A point that's trivially redeemable against a wide catalogue is worth more to a member than a point of identical nominal value that's hard to spend. Get the rate wrong in either direction and you either subsidise the partner's members at your own programme's expense, or make the exchange unattractive enough that nobody uses it — which defeats the purpose of building it.
The rate also needs a mechanism for revisiting it. Redemption values drift as catalogues change; a rate agreed at launch can quietly become unfavourable to one side eighteen months later if nobody revisits it.
Settlement: where the actual money moves
Every points transfer between programmes is, underneath the member-facing experience, a real financial transaction between two companies. Brand A's member moves 5,000 miles into Brand B's programme as 12,500 points — and now Brand A owes Brand B for redemption cost, or vice versa, depending on how the agreement is structured. This has to be settled on a schedule, reconciled against actual transfer volume, and audited by both finance teams.
The reconciliation problem is usually the part partnerships underestimate. Two-way settlement means both sides need to agree, transaction by transaction, on volume, rate applied, and timing — and any discrepancy (a transfer that posted on one side but not the other, a rate mismatch from a mistimed rate change) needs to be catchable and resolvable without a manual audit of every transaction. Without that, disputes about settlement become a recurring cost of running the partnership, not a one-off implementation problem.
Building the technical connection
If the partner has an API, the integration is a real-time, two-way call: a member initiates a transfer, points debit from one programme and credit to the other, and both sides get a webhook confirming it landed — typically in under a second if both platforms are built for it. If the partner doesn't have an API — which is common with smaller or legacy programmes — the connection has to be built as a batch reconciliation process instead, which changes the member experience from instant to next-day, and needs to be communicated clearly so members don't assume the transfer failed.
Either way, the technical build needs to answer a few questions before launch: What happens if a transfer is initiated and the partner's system is down — does it queue, or fail and refund immediately? How is a partial or failed transfer reported to the member? And who owns the reconciliation dispute process when the numbers don't match at month-end?
Joint campaigns are a separate conversation
Beyond one-off transfers, most coalition partnerships eventually want to run joint campaigns — a co-branded offer where members of both programmes get a bonus for a qualifying action with either brand. This needs its own settlement logic, separate from standing transfer volume, and needs to be modelled before the campaign launches, not reconciled afterward. A joint campaign that isn't cost-modelled up front tends to become a conversation about who owes whom, right when both marketing teams are trying to call it a success.
The commercial agreement has to be written by people who understand the mechanics
The version of this that goes wrong is the one where the commercial team signs an agreement on exchange rate and volume caps, and the technical and finance teams find out the settlement mechanics afterward. The agreement needs input from whoever is going to reconcile the numbers monthly — because an unworkable settlement process, discovered after signing, is a much harder conversation than getting it right in the term sheet.
Why choose Walaa
Coalition partnerships live or die on the reconciliation layer, which is usually the part built last and trusted least. Walaa's exchange API handles real-time, two-way transfer with signed webhooks confirming each leg, a median call time of 180ms, and built-in two-way reconciliation — so settlement disputes aren't a manual audit of every transaction. If the partner is already on Walaa, connecting a new coalition is a settings change, not a fresh integration project.
Walaa is a loyalty platform built with points exchange as a core module, not an afterthought bolted on for one partnership.
