The Pepper Rewards App, which went down earlier this year for what they claimed to be a “planned outage” (that was unannounced in advance) as they prepared to launch “Pepper 2.0”, promising that unredeemed “coins” balances were safe and would become redeemable (for the sake of clarity, the Pepper Rewards app was of no relation or connection to our own Stephen Pepper). Unfortunately, things don’t look good on that front as Blackhawk Network has filed a lawsuit seeking repayment of a $65 million promissory note. It doesn’t sound like Pepper is likely to come back.
Pepper Rewards App promised version 2.0 coming and that coins were safe, but it doesn’t look likely
The Pepper Rewards app made waves last year and in early 2025, selling merchant gift cards, often with 5-10% back (sometimes more) in the form of “coins” that could be redeemed for more gift cards. The app was particularly popular for the ability to get 5 to 10% back on rarely-discounted brands like Amazon, Walmart, and Best Buy.
In the beginning, I think most readers probably assumed that the initial launch was using venture capital funds to create a user base and that promotions would slow down. However, promotions persisted, including on those rarely-discounted brands, for far longer than I would have anticipated being feasible.
Eventually, the app stopped selling Amazon gift cards except for redemption with coins and the availability of Walmart or Sam’s Club gift cards came and went. “Coins” began taking longer to post, and tracking was a headache. It felt like the writing was on the wall.
Then, early this year, the Pepper App abruptly cut off the ability to buy gift cards or redeem coins as part of a “planned outage” to launch “Pepper 2.0”, promising that “coins” balances would be preserved for use in the new version of the app.
Unfortunately, it seems that is unlikely to happen as Blackhawk Network, Inc has filed a case against Moochoo, Inc (parent company of Pepper Rewards) in the Circuit Court of the Ninth Judicial Circuit in and for Orange County, Florida for breach of secured promissory note, enforcement of security interest, and breach of contract. You can search the court’s site here to find the full text of the complaint (the date of the filing was 9/19/25).
In short, it sounds like Blackhawk provided $65 million worth of gift cards under a promissory note for Moochoo to pay, with interest increasing after the first year. Interestingly, if I am understanding the complaint properly, it sounds like Blackhawk would have stood to gain 50% of funds raised in excess of $10 million on top of getting repaid.
Unfortunately, according to the complaint, Moochoo missed required payments this year. The complaint includes email exchanges between the CEO of Moochoo and Blackhawk, with the CEO of Moochoo trying to negotiate a repayment plan, claiming to have investors lined up but only if they could have worked out a favorable repayment plan. It sounds like Blackhawk wasn’t willing to accept Moochoo’s proposals and Moochoo has conceded that it has no path forward (and apparently has $15 million in obligations for notes that take precedence over Blackhawk’s).
As per my layman’s read of the details, it sounds like the total owed continues to accrue a large amount of interest each day.
Suffice it to say that it doesn’t look like there is much hope for unredeemed coins. Hopefully, Blackhawk doesn’t invalidate cards that were previously sold by the Pepper Rewards app but haven’t yet been redeemed and for which Blackhawk was presumably not paid. I would think that they would have already done that if that were their intention, but neither would I wait to find out.
It is disappointing that Pepper couldn’t find a path forward, though the returns they were offering didn’t seem sustainable. I think most power users were redeeming coins as soon as they were available. My guess (and this is only speculation) is that coins were redeemed sooner than had been forecast and Pepper just couldn’t make the numbers work. That’s really disappointing for consumers who had been holding unredeemed coins.
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would there be any issue with the gift card purchased such as walmart/sams in the pepper app?
I never understood what their business plan was after they burnt thru other people’s money?
Hah, figures that the whole unplanned 2.0 launch was a blatant lie to try to stall for time.
BHN promissory note worth $65 million. I’m guessing they didn’t cash in their pepper points in time.
Nick I’m curious which paragraph mentioned BHN provided 65mil gc. I found the complaint and “gift card” only came up in a section dictating certain bank account controls if Moocho distribute gc via 3rd party.
Maybe Blackhawk and Pepper will merge into Black Pepper?
I had 4K worth of purchases that errored out and they stonewalled me for months. Did a charge back with Amex and was approved.
We kinda of lucked out – finally jumped in on Pepper back in January for P1(Used a FM referral link)/P2 and stacked both sign-ups with the Amex $30/$75 and Referred P2 and bought Amazon and SW GC (before the announced Elliott devaluation/refresh.
Calculated earnings for purchases as close as I could to the hit the CG Cash-out.
This was days before they pulled the Amazon option.
Anyone find any other source of giftcards that allows $1 transactions?
I could never get set up on the app (only tried for an Amex offer) and since the customer service was completely unresponsive to several inquiries, i just gave up. Glad i did. Hopefully not many people are stuck