At least here in the US, retailers already do better than this with their closed-loop (merchant-specific) gift cards: you pay them an activation fee to get the card and they make interest on the money until it's spent.

That also has its own unique problems - if a retailer goes into bankruptcy, the gift cards are likely to be worthless (they're considered "unsecured debt"). Buying gift cards from a brand-new startup would be taking considerable risk.

Then there's the IT integration hassles, since existing closed-loop cards are coded into their POS etc. Adding "Credits" is going to take additional development - why are retailers going to spend money to do that?

The other option would be an open-network style card, but those are typically issued (again, in the US) by companies like MasterCard and Visa & carry the usual processing fees.

Since the merchants ultimately want to be paid in USD (or other local currencies, but we'll just say USD for simplicity), you could start a company which takes in USD and gives back a one-to-one token for USD, which can then be either traded back and forth for crypto and associated with your Credits cards. Since this USD token - call it a "Tether?" - is 100% backed by USD, associating with a CC is basically just another debit card with a weird backend at the bank that holds the cash.

Critically, "Tether" and the dollars that back it would have to be held in a transparent, auditable manner by the company who of course would comply with all regulations. Otherwise, no US bank or major retailer would touch them.

> The fee would be paid at the point of converting your crypto to the 'Credits'(which users would happily pay, they already do when converting to Fiat)

These fees are going to have to be higher than normal conversion fees, if you want to fund the credits operation - someone is going to have to pay for -

Alterations to the PoS software to accept credits Server infrastructure which can authorise the transactions Helpdesk staff to help out the shop staff when they get confused/stuck/whatever