The introduction of customer relationship marketing instruments by retailers has been strongly advocated in recent years both in theory and practice. Consequently loyalty programmes have become an increasingly popular choice of marketing strategy by retailers particularly those holding the notion that such loyalty programmes are an important strategy and mechanism for retailers to build store traffic, increase basket size and increase frequency by creating deeper relationship ties with their customer base. However, despite the enthusiastic response given to loyalty programmes by retailers and customers alike, the current position of loyalty programmes is at a crossroads where some quarters in the marketing industry have begun to question the effectiveness of such programmes in garnering customers’ support and loyalty. So far, most research suggests that customers value loyalty programmes mainly because of the benefits and economic gain, however, previous researchers also noted that the programme service quality is also important. Based on this premise, this paper reports on a preliminary study of the literature which has been conducted in an attempt to understand the issue and role of service quality in retail loyalty programmes as well as factors that are important in loyalty programme service quality