The process of merging a web account with a loyalty account is identical to that of combining and closing loyalty accounts. Only users with a specific level of permission may merge web accounts with loyalty accounts. To do this, you must first find the customer through the "Find Customer" screen. If they've created an online account they will have two accounts. One that looks like a typical loyalty account and one whose customer code starts with a "+" and is shorter in length than a typical customer code. You MUST merge the web account into the loyalty account. Merging a loyalty account into a web account would result in the customer having only a web account and is not desirable (their card would no longer scan).
Edit the web account and go to the "Close Account" (ALT + C) page. Select the loyalty account using the "Find Account to Transfer Points and Credit" button.
Once you select the loyalty account, double checking you're merging the web account into the loyalty account and not vice-versa. Once you're sure you can go ahead and click the "Close Account and transfer points/credit to:" button. A pop-up will confirm the success of the merge.
If you look up the customer again you'll notice that the web account is now highlighted in red like a regular closed account would be. The web account has now been merged with the loyalty account.