An expiration rule attaches a clock to earned currency. Common designs expire points a fixed term after they are earned, or reset the clock whenever the member earns or redeems, so any activity keeps the balance alive. The program tracks each point's age and voids balances that cross the threshold, recording the event so finance can recognize the associated breakage.
Consider a program that expires points after a period of account inactivity. A member who earns steadily never loses anything, but a member who lapses past the window forfeits the balance. That policy pushes some members to make a small qualifying purchase to reset the clock, which is often the point, while frustrating members who feel value was taken away.
For an enterprise operator, expiration is a balance between liability control and member goodwill. Aggressive expiry shrinks the liability and lifts breakage but risks resentment and churn. Generous or activity-based expiry protects the member relationship at the cost of carrying balances longer. The right setting depends on margins, competitive norms, and how the program wants to be perceived.
