Frequent flyer programs by numbers
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Frequent flyer programs by numbers
Tue 22/05/07
By ACA staff
Working out which is the best credit-card based frequent flyer programs can be confusing with banks doing their best to make sure it's tough to compare apples with apples. A new service promises to make the task easier.
Rate City's Andrew Willink says his company has come up with ultimate online comparison tool for shoppers wanting to know which loyalty program is the best.
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The website's new comparison tool rates each credit-card based frequent flyer program across a large number of offered extras such as petrol vouchers.
The best card for shoppers who spend under $12,000 a year on their credit card
For most shoppers, the site gives a five-star rating to five different programs; the AMEX standard Qantas Frequent flyer program, Citibank Silver rewards, NAB Ant Rewards, and Westpac Altitude Rewards.
What set these cards and their loyalty programs apart from others? None of the cards charges consumers a fee for the reward program on top of the individual credit card's annual fees. All awarded at least one point per dollar spent and none of points consumers earn through their spending have an expiry date.
All of the top rating card also use Qantas as their airline partner and with the exception of the NAB card, the others all offer consumers a Sydney to Melbourne flight after they have earned 16,000 points.
Consumers should carefully consider their options though before they join up to credit-card based schemes, according to Rate City.
The interest rates attached to these card can be a trap. "If you don't pay back your card on a regular basis, you end up paying extremely high interest rate on a card that is supposed to offer you bonuses," says Andrew.
The top four cards for consumers who spend under $12,000 per year on a credit card have interest rates that vary from 18.24 percent to 19.24 percent.
The best card for shoppers who spend larger amounts on their credit card each year
Westpac's altitude card, the AMEX rewards card, the AMEX Rewards ascent card and the ultimate AMEX Qantas frequent flyer program are the top card for those with a larger budget.
The Westpac card offers three points per dollar spent and the others all offer 1.5 points per dollar spent. Again none of these cards charges an extra fee for the rewards program they offer and points do not expire.
Tips on choosing a credit-card based loyalty program
Pay the card off : As the interest rates of these cards may be higher than other credit cards, its best to pay them off quickly. Otherwise consumer risk getting themselves into greater debt.
Are the rewards offered suitable? Consider if the frequent flyer rewards suit your travel needs. For example, if you don't travel domestically that often and the card offers you a quick way to earn points for flights around Australia — ask yourself if this is a reward you are really likely to use.
Fine details: Check the rules first. Before accruing points on a scheme that it is hard to redeem points from, be aware of things like the lifespan of the points and any rules and restrictions about upgrading on flights.
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