By Michael Sainsbury, Senior Business Correspondent

Card schemes and airline loyalty programs are fuelling a fast-growing fintech niche built around the simple promise of letting businesses pay every bill on a card and turn operating expenses into frequent-flyer points ahead of the looming interchange crunch.

At the centre of that push sits Pay.com.au, founded in 2019 by Point Hacks founders Ed Alder and Damian Waller, and former Coles rewards executive Grant Austin. It is reported to be preparing for an ASX listing worth $800 million after a series of capital raises making it the best-funded and most visible player in a field of local rivals and copycats.

Backers include Morgans, Wilson Asset Management, Thorney Investment Group and Ophir Asset Management, alongside prominent investors such as Adam Schwab and members of the Gandel family. Goldman Sachs and Morgans have been appointed to work on a potential IPO.

“It’s become much more than just a payment platform for earning reward points; it’s evolved into a full ecosystem for SME payments,” Alder said in an interview last year. “We call ourselves the Switzerland of points because anyone can connect with us, whether it’s BPAY, credit card, bank transfer, or multiple airline and hotel partners”.

A model built on rewards economics

The mechanics underpinning the sector are straightforward. Businesses upload invoices, tax bills or supplier payments, pay the platform with a credit or charge card, and the platform forwards the funds via bank transfer,  BPAY or increasingly using a commercial credit or charge card.

In return, customers earn card rewards and often an additional layer of platform or airline points. pay.com.au markets the product as enabling businesses to earn rewards on expenses that traditionally could not be paid by card.

The value proposition has resonated because loyalty programs remain one of the most powerful behavioural levers in payments. As banks have tightened card rewards and reduced partner breadth, airlines have remained the anchor partners continuing to drive spend and customer acquisition.

Despite its scale, pay.com.au operates in an increasingly crowded market of Australian platforms attempting to monetise the same behaviour.

Sniip, founded in 2013, is the longest-running player and one of the better-funded. The Brisbane platform raised about $3 million from investors including Darren Lockyer and other private backers, followed by a $3.2 million pre-IPO round, and operates as an unlisted public company.

Payment Logic, founded in 2013, enables supplier payments via card rails. RewardPay, founded in 2016, integrates closely with Qantas Business Rewards to allow points earned on supplier and government payments. B2Bpay, founded in 2017, similarly targets business expenses through airline rewards partnerships.

Newer entrants include Lessn, founded 2020, positioning itself as a hybrid AP automation and rewards platform, and Billr, a more recent launch marketing “pay anyone with your card” functionality.

Most of these competitors remain modestly funded compared with pay.com.au. Lessn has disclosed a roughly $1 million early-stage raise, while RewardPay, Payment Logic and B2Bpay have not publicly detailed large venture rounds.

The funding gap is central to the IPO story. If pay.com.au lists successfully, it would gain a balance sheet advantage that could allow heavier spending on marketing, partnerships and technology potentially cementing a first-mover advantage in a sector where brand trust and distribution are critical.

Offshore lineage — innovation or localisation

While the sector is often framed as a home-grown fintech innovation, its roots arguably lie offshore.

In the United States, B2B payables platforms such as Bill.com and Melio popularised card-funded accounts payable as both a working-capital tool and rewards generator.

In the UK and Europe, virtual card adoption in corporate payments — particularly in travel — has long relied on similar economics, converting supplier payments into card transactions funded by interchange revenue.

Australia’s iteration of the model sits somewhere between those worlds: a localised version that combines US-style payables automation with the airline-centric loyalty ecosystem that dominates the Australian market.

The rise of these platforms has also been supported by a broader cultural shift in how consumers and businesses view loyalty economics.

Websites such as Point Hacks helped normalise the idea that paying a fee to earn points could be rational if the redemption value exceeded the cost — a mindset that migrated from consumer travel hacking into small-business finance.

That shift created a ready audience for platforms promising to turn large, unavoidable expenses into points-earning opportunities.

Card schemes and airline ecosystems

The sector’s expansion has been closely linked to card networks and loyalty programs.

pay.com.au’s partner ecosystem includes major schemes and airline programs such as American Express, Visa, Mastercard, Qantas and Virgin, reflecting the reliance on both payment rails and rewards redemption partners.

Competitors show similar alignments. RewardPay’s Qantas integration and Sniip’s partnerships with BPAY and American Express highlight how the model depends on both scheme economics and loyalty partnerships.

For card networks, the attraction is straightforward as it shifts billions of dollars of supplier and government payments onto card rails and generates interchange revenue and transaction data.

Despite its popularity, the model has drawn criticism from industry observers who argue businesses may be paying more in fees than they receive in rewards value.

Processing fees typically range from about 1-3% depending on card type and earn rate, meaning the effective cost of points can exceed their realisable value unless redeemed optimally.

The economics also depend on interchange settings and scheme incentives, leaving the model exposed to regulatory or competitive shifts that could compress margins.

Australia’s payments regulation has historically targeted distortions created by interchange-funded rewards, and further tightening remains a risk for the sector.

Any reduction in interchange or changes to surcharge rules would directly affect the economics underpinning high earn rates, while banks’ ongoing reassessment of rewards programs could further reshape the landscape.

Yet airlines remain the most resilient partners because loyalty programs continue to generate significant revenue and customer engagement, anchoring the sector even as other rewards partnerships fluctuate.

The rise of pay.com.au and its competitors ultimately reflects the enduring power of loyalty programs in shaping payment behaviour.

For businesses, the appeal is clear: turning tax, rent and supplier payments into travel or perks. For fintechs and card networks, the opportunity lies in shifting large volumes of previously low-margin payments onto card rails.

The upcoming IPO will test whether investors believe that arbitrage can scale sustainably and whether a well-funded market leader can consolidate a fragmented field.