Credit card issuers are making changes to their offerings, as they prepare for significant changes to interchange rules next year, but customers have indicated that they won't be satisfied with any old "reward substitution".From July next year, the credit card interchange benchmark, which is a weighted average of 50 basis points, will be supplemented by a cap of 80 bps on individual interchange rates.The cap will result in a significant narrowing in the range of interchange rates paid by different merchants.Compliance with the interchange benchmark and cap will be monitored quarterly, rather than every three years.Interchange-like payments to issuers in the American Express companion card system will be subject to equivalent regulation as applies to MasterCard and Visa credit card systems.There will be limits on any scheme payments to issuers that are not part of the interchange benchmarks. This is designed to prevent any circumventing of the interchange standards.Visa Australia, New Zealand and South Pacific head of product, Rob Walls, said: "The biggest flow-on effect of the regulation is expected to be a dilution of reward programs. Issuers are expected to re-set their value propositions."Walls said issuers were already making changes - imposing caps on the number of points that can be earned in a given period and changing redemption rates on points.Visa commissioned RFi to find out what reward substitution customers would accept. Consumers were asked to rate the appeal of discounts on other banking products and discounts from retailers.Sixty-two per cent said that discounts, benefits or rewards on other banking products would not be a fair replacement for the reward points they currently earn and 63 per cent said the same about retail discounts."Value does not have to be financial. Customers recognise value in greater control and information as well," Walls said.He said innovations that have been introduced into the credit card markets overseas include greater functionality through mobile apps, geolocation, usage monitoring and controls, activity alerts, spending reports, digital receipts and cardless cash withdrawals.Some of these features are already part of online and mobile transaction banking services. Walls said that they would soon form part of credit card account offerings. He said there was also scope for changes in the way repayments are structured. Earlier this year Citibank introduced a fixed payment option that allows credit card customers to convert part of their revolving balance to a term payment arrangement at a lower rate.American Express has added an alternative payment option for its credit card customers, allowing them to pay for large purchases in monthly instalments at zero interest. Customers have to select a purchase amount (the minimum is $300) and select a term of three, six or 12 months. For the next six months purchases equal to or above the chosen purchase amount will be automatically converted into instalment plans.