MasterCard has dived feet first into the card linked loyalty battles with the acquisition of Truaxis. The company should prove to be an anchor for MasterCard Offers Services, where it has partnered with Local Offer Network and others.

Formerly known as BillShrink, a lowest rate guide which developed a customer base of 1.6 million, Truaxis has most recently been competing with other card-linked loyalty players for bank affilations. The company has raised $9 Million since its founding. BIA/Kelsey estimates that more than $170 million has been specifically invested in the bank-dependent, card-linked loyalty space.

Banks enjoy the affiliations because a loyalty card enhanced their chance to win “top of wallet” share. It also allows them to shift the costs to supporting the rewards of their credit/debit cards to merchants; while also getting a commission for the sale of products.

Key players in the space include Cardlytics, Cartera Commerce, Edo Interactive and FreeMonee Network. Other key players are also developing loyalty products — more than 20 — but are not dependent on bank relationships. These include such diverse players as Square, LevelUp and Groupon.

While Truaxis hasn’t landed any major banks, it works with 2,500 independent banks via a marketing relationships with Jack Henry & Associates, a bank platform provider.
Clearly, the affiliation with MasterCard could provide a major jumpstart for the company.

We’ll be taking an intensive dive into the loyalty space at SMB Digital Marketing in Chicago Sept. 17-19, as we feature top execs from Cartera, Edo, Belly, Groupon and Local Offer Network, among others. Register here.

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American Express is all over the deals and promotions space, with its Link, Like, Love campaign on Facebook; Twitter offers; and geo-based deals on Foursquare. Its Serve product also has been providing deals for AOL’s Patch.com.

Until now, there has been little response from the bank-originated credit card companies: MasterCard or Visa. Today, MasterCard announced its own, initial deals initiative — “MasterCard Offers Services” — a daily deals and promotions distribution effort for its bank members. At the same time, MC promises that consumers will have a “simple, easy-to-navigate technology system.”

Initially, MasterCard is teaming with Local Offer Network, a deals aggregator and network. Member banks will be able to pick and choose deals in various formats and vertical segmentation from local and regional merchants. Vertical segmentation will likely include shopping, travel and experiences. Content will be available by the end of this quarter.

MasterCard has also been working with loyalty providers such as Next Jump to provide them with anonymized data. It is not clear whether MasterCard will be working with merchants to enlist them in deals. It also doesn’t appear that there there is a loyalty angle with the arrangement. Perhaps that will be included in the next phase. Last year, MasterCard reported that it had 37 million merchants and 63 billion annual transactions coming through its network.

Many banks already work in the promotions space with various loyalty and engagement programs such as Cartera Commerce’s OfferLink and Edo Interactive. The relationships reinforce the banks’ merchant relationships by providing them with extra value. It also keeps the commissions in house (i.e., away from e-wallet schemes) and reinforces their own brands as trusted commerce channels.

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Ease of transaction, rewards and “exclusives” will be key to the next generation of deals, and the credit card companies are determined to play a major role. MasterCard is working with NextJump for a special rewards programs, and has a number of other initiatives in the space (which key execs will discuss at our Deals 3D conference next month). CitiGroup branded MasterCard, similarly, is partnering with Google to offer deals over mobile phones. Groupon is also said to be working on a credit card arrangement.

Now, American Express is revving up “Serve,” its erstwhile PayPal killer. Serve is an online and mobile commerce platform that enables consumers to preload cash on the card and eliminates the need to print out coupons, among other things. A key part of the platform will be local deals, which will be promoted on AOL’s Patch.com, which expects to have more than 1,000 hyperlocal sites by the end of the year. Customers will need a special credit card to participate.

The arrangement kicks in this fall, launching in Eugene, Oregon. Full personalization based on individual customer data will be fully developed in six to 12 months, according to AmEx (via Chicago Business).

It isn’t clear whether Patch will also be sourcing deals. Patch had previously announced a new initiative it calls “Patch eSaver,” which will show all the deals available in town every Tuesday.

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