Airline Credit Cards

The Lowdown on Airline Reward Program Cards

The way in which airline credit cards work is actually quite simple. You make a purchase for anything with your airline credit card and you then get a cash back bonus, usually around 5%, that can be used for either flyer miles, hotel stays or even rental cars. If you spend a lot each month using your credit card, this is a great way to get money back to travel. Some issuers work their rewards program a little differently. They will offer, say, 1.25 dollars for travel on every dollar that you spend on your airline credit card. This is a very quick way to earn frequent flyer points and is a very popular option.

If you are interested in getting an airline credit card, there are a few things to keep in mind. First, make sure you are the right consumer for an airline credit card. If you don’t spend much each month on credit then you won’t see the benefits of a card like this. Secondly, you will need to make sure that the miles you earn can be transferred to your airline of choice. Next, it is also a good idea to pick a credit card that has not only a low introductory interest rate but also a low rate after that initial welcome period. This will keep all your costs down and you can still enjoy the benefits that this type of credit card can offer.

Specific Airline Credit Cards

• Qantas Frequent Flyer Credit Cards – Compare credit cards linked directly to the Qantas Frequent Flyer program and earn points for cheaper Qantas flights and travel perks.

One of the Most Popular Rewards

If you need to fly for business or you simply love to travel, then an airline linked credit card could be a great choice for you. You earn and accumulate points by using your card on everyday transactions, then redeem these points for rewards such flights, cashback and travel shopping vouchers. This type of card is particularly suitable if you use your credit card often and maintain good spending and repayment habits. Take a moment to look through what’s available on our comparison table and consider the various rates, fees, credit limits, points and rewards on offer.

Common Features

Apart from the ability to earn points, what other features are common on this type of card?

• Overseas travel insurance – Airline cards are naturally popular with people who travel frequently, and so many of them offer travel insurance as an additional feature. However, there is a question over just how good credit card travel insurance is in comparison to dedicated travel insurance. In nearly every case, the complimentary overseas travel insurance provided with a credit card is inferior to the cover offered by a dedicated travel insurance policy purchased separately. While it is a useful feature that may save you money, it may not be wise to solely rely on it to cover you in the event of an accident in another country. Before you apply, or decide to discontinue your existing travel insurance policy, carefully check what you are covered for, how much you are covered up to and in what scenario. Failing to do so could mean that you are, in effect, not adequately insured against risk when travelling.

• Domestic flight inconvenience insurance – Another insurance feature, domestic inconvenience covers you when a flight gets cancelled or delayed and thereby inconveniencing you on your journey. Again, as is the case with overseas travel insurance, it is best to check the small print before relying on it as the cover may only come into effect upon certain strict criteria, e.g. delayed for a set number of hours.

• Free flights – Some cards will give the cardholder a number of free flights per year, although there are strings attached. These flights are only available with the airline linked to your credit card and are most likely only available on a set list of routes. They may also only be available at certain times of the year outside peak travel season. Therefore, this enticing feature may be a welcome added extra that you have to plan well ahead for if you want to actually travel for free.

• Concierge service – Although a widespread feature of platinum cards, the concierge service is also quite common with airline linked cards. These services provide 24/7 assistance for tasks such as, but not necessarily limited to, booking flights, arranging taxis and airport transfers, reserving a table at a restaurant, giving you directions, etc. How useful they are to you depends on how much time you have to spare. If you’re travelling for business and have a tight schedule, knowing that you can phone the concierge service to arrange where you’re eating out can make your day a lot less stressful and more productive.

Help with Choosing a New Card

Q: What’s the point of having a credit card linked with an airline? A: Airlines usually run their own reward program specifically aimed at travellers who want to be enjoy flights and travel perks. A credit card that is linked to one of these reward programs gives the accountholder access to a range of premium services such as entrance to the airline’s airport lounges, faster checkin and boarding and, of course, upgrades to better seats at reduced pricing. Cardholders can use their card to build points, often referred to as frequent flyer points and occasionally as air miles, that can be redeemed for flights to a range of destinations served by the airline. Other benefits typically include overseas travel insurance and a 24/7 concierge service, but may include airport transfers, insurance against flight inconvenience and cover for purchases made overseas.

Q: Are they the right choice for me? A: If you are a frequent flyer, travel often for work or leisure, or would like to collect points towards a holiday, they could be a great choice for you. This type of card is suitable for people who use their cards often; the more transactions you make the more rewards you earn. They are best for responsible spenders, and many are aimed at high earners, so consider your financial habits and circumstances before applying. If you are not in a sound financial position and can’t pay off the balance each month, then they probably aren’t going to serve your needs very well.

Q: Can my business earn points? A: Yes, in fact many businesses already use cards to earn rewards points on their expenses – it’s a great way to get something back! If you use your card frequently, you could be missing out on lot of rewards points. Businesses typically have many more expenses than consumers as they need to spend on advertising, utilities, flights, hotels and entertaining clients. They also have staff, who can also pay for their expenses using a card linked to your main account. When managed properly, a business that puts transactions through their credit card can stand to earn a lot of points!

Q: Are they linked with any particular airline? A: In Australia most of them can be linked with your Qantas Frequent Flyer account, the most popular airline rewards program in the country. However, not everyone flies Qantas. Thankfully there are cards linked with alternative international and domestic airlines such as Singapore Airlines, Emirates, Virgin Australia and Jetstar. When making your choice, it’s important to consider what airline you prefer flying with and whether they service your most travelled routes. For example, there’s no point applying for a Qantas airline card when they don’t actually fly the route you’ll need to travel the most. You should also be sure that the airline flies from an airport near your location. Imagine how frustrating it would be to earn points for rewards with an airline that only flies from Melbourne or Sydney when you live in Perth.

Q: I don’t pay off my monthly spend in full, so are they for me? A: It’s best to always pay your card off in full each month, regardless of it being a credit card with a rewards program or not. However, if you have an airline points card and don’t pay off your balance in full each month, the interest charged will quickly nullify the real value of any rewards you’ve acquired. In essence, it would be a waste of your time. If you want to get the most from an airline linked card, or any credit card, try to pay back your balance in full at the end of every month.