FreeMonee has been set up by a collective including former eBay and Best Buy CMO Mike Linton, ex-Visa exec Jim Taschetta, ClairMail founder Joe Salesky and Oracle veteran Gadi Maier.

It has already raised $11 million in funding from Opus Capital Ventures, Redpoint Ventures, Sutter Hill Ventures, Pinnacle Ventures and Contrarian Group.

The network lets merchants give "gifts" directly to individual credit and debit cardholders through participating financial institutions. These gifts are cash incentives, enabling consumers to buy anything they choose at the designated merchant by using their debit or credit card.

The system is based on the firm's patent-pending Adaptive Matching Technology (AMT), which analyses the transaction data of hundreds of millions of debit and credit card holders - "while protecting privacy" - and matches gifts with likely buyers.

Freemonee says it already has agreements in place with two of the top six card issuers and is working with several others ahead of the first programme launch this summer.

Gadi Maier, CEO and president, FreeMonee, says: "FreeMonee, and the technology that powers it, is revolutionizing the bank-merchant-consumer dynamic, enabling each to benefit the other. Our AMT gives banks and retailers the ability to give customers exactly what they want - gifts they will use with no strings attached - while minimizing the risk that had previously made such powerful purchasing incentives impossible. Merchants get net, new profitable visits and banks receive a significant new source of consumer-friendly revenue."