This article talks about how airline credit card offers for consumers are chosen.
People are using airline credit cards more and more. Airlines and banks, in particular, often sponsor airline credit cards as a way to get people interested in them. But before you choose an airline credit card, you should find out as much as you can about each one you are thinking about.
If you travel for business or fly often, an airline credit card is something you should look into. But you might wonder how credit cards for airlines work. Simply put, for every dollar you spend on the credit card, you get reward points, also called miles. With these points, you can get free flights, free tickets for a friend, protection against lost bags, an upgrade to first class, a rental car, a free hotel stay, and more.
Citi Aadvantage was the first credit card to offer an airline credit card. Every time a customer bought something, they got points. You could use these points to get free flights on a number of different airlines. Today, most airlines work with credit card companies to offer rewards programmes for airline credit cards. The incentives offered by these companies are appealing, in part because of the competition in this industry.
Compared to regular credit cards, airline credit cards have higher interest rates and, in most cases, annual membership fees. But when used well, airline credit cards have a number of nice features that help to make up for the extra fees and charges.
There are two main types of credit cards for airlines:
- Credit cards from airlines
- Credit cards that are backed by banks
If you get a credit card from an airline, you can only use the points you earn on that airline. These cards are helpful if you want to fly on a certain airline or if that airline is the only one that goes to the places you want to go. If not, it might be better to get one of the many airline credit cards that banks now offer.
The terms of bank-issued credit cards are more flexible. With airline-sponsored credit cards, you can usually only use your points on one airline. With bank-sponsored airline credit cards, however, you can use your points on a wider variety of airlines. And most of the time, with bank-sponsored credit cards, you need less points to get free travel. This rule isn't always true, though.
Things to remember
Before making a decision, you should make sure you fully understand how airline credit cards work for you and how they work for the card companies. You could ask people who already have one, like family or friends, what they like or don't like about their cards. You can also use the Internet, which has more information than ever before about all kinds of credit cards and their features and benefits.
First, when choosing a credit card, you should start by looking at how much interest each one charges. Is the interest rate similar to what other cards offer right now, or does it seem unusually high? If you plan to keep a balance on your credit card, you must choose an airline credit card with the lowest ongoing interest rate. Most of the time, people who carry a balance on their credit cards shouldn't get airline cards because they tend to have higher costs. Higher card balances and higher interest rates never go together.
Some credit cards for airlines let you earn points, but only on certain purchases. Keep these reward programmes in mind when choosing a card, because the card won't be very useful if you can't use it to buy the things it lets you buy.
Another important thing to think about is when your points will run out. Find out if you can still use your points after the time for redeeming them has passed. Some cards have rules about how points can be redeemed at certain stores after the expiration date.
Lastly, each card has a different number of reward points per dollar spent. Also, the number of points you need to earn free or discounted travel will vary from card to card, so make sure to weigh these things carefully when choosing an airline credit card.
