Debit cards (banks) make money on interchange fees. But Fold decides not to. Instead they take that fee and give it to the customer in sats, and then just charge a monthly for the banking service. So if you use it right, you can get tons of rewards because you are just earning your own interchange fees that the bank usually earns off of you.

With the gift cards, retailers sell gift cards in bulk at discounts, and then the sellers pass that discount onto the buyer. Because literally billions of dollars in gift cards go unused, and it locks in the buyer to the service so they gain by having guaranteed return customers until the balance of the card is used.

Then there is just general rewards. If you give someone a free coffee after they buy 8, then not only do you reward loyal customers, but you also ensure that they will stop by a 9th time get a free coffee, and probably pick up a breakfast sandwich and a danish to go with it. Then they'll start earning rewards to their next free one.... its a way to entice customers to stick around and have a way to stay ahead of the million other things that will pull us one way or another during the day.

Rewards actually make a ton of sense, which is why they are so prevalent, and the setup for the companies I use in this example are both sustainable and really clever actually.