One of the most common questions when launching a Qarrot program is:
“When do we actually pay for the rewards?”
This article explains how points, budgets, and funding work together.
Key Concept: Points ≠ Cost
In Qarrot, points themselves do not have a direct cost when they are awarded.
Costs are only incurred when employees redeem points for gift cards (or Amazon products for US-based accounts).
How the System Works (Step-by-Step)
1. Assign Giving Budgets
Admins allocate giving points to other users using budgets.
Example: A Team Lead receives 100 giving points per month
These points are meant to be used to recognize others
👉 No cost is incurred at this stage.
2. Team Leaders Award Points
Team leads use their budgets to:
Send recognitions
Run campaigns
Users accumulate spending points as they receive recognition.
👉 Still no cost at this stage.
3. Users Redeem Points
Users redeem their accumulated spending points for rewards such as:
Gift cards
Donations
Custom rewards (if configured)
Amazon (if enabled, only available in the USA)
👉 This is when cost is triggered for specific reward types (see below).
4. Gift Card/Donation/Amazon Rewards Value Are Deducted from Funding Balance
Admins maintain a rewards funding balance (prepaid pool of money).
When a gift card, donation or Amazon product is redeemed:
The USD value of the reward is deducted from this balance
What Actually Triggers a Cost?
Funds are only deducted when users redeem:
Gift cards
Donation rewards
Amazon products
👉 Other reward types (e.g., custom rewards fulfilled outside of Qarrot) do not deduct from your funding balance.
Example
Admin deposits: $10,000
Team leads and users distribute giving points over time
Users redeem spending points for rewards
If an employee redeems a $25 gift card:
→ $25 is deducted from the funding balance
Important Notes
✔ You are NOT charged when:
Points are allocated to team leaders
Points are awarded to other users
✔ You ARE charged when:
Users redeem gift cards, prepaid cards, donations, or Amazon products.
Why This Model Works
This structure allows you to:
Control budget allocation (via point budgets)
Pay only for actual usage (via redemptions)
Avoid overpaying for unused rewards
What Happens to Unused Funds?
If you have remaining funds in your rewards balance when you terminate your subscription, you can contact your Account Manager to request a refund of the unused amount.
Best Practices
Deposit funds based on expected redemption volume, not total points distributed
Monitor your Rewards and Redemptions report regularly
Adjust budgets over time based on usage trends
Related Help Articles
Summary
Action | Cost Impact |
Assign budgets | ❌ No cost |
Recognize with points | ❌ No cost |
Redeem gift cards/donations/Amazon | ✅ Cost applied |
If you’re unsure how much to fund your account or how to structure budgets, your Account Manager can help you model this based on your program goals.