Maximise your Avios, air miles and hotel points

What I learned when I met all the big players in UK travel credit cards

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I spent Tuesday at a conference in London focussed on travel loyalty credit cards.  Whilst I don’t like taking a day out of my schedule, I felt it would be good to get a feel for how the industry is responding to the EU-imposed fee cuts.

It was a fun event and I was impressed by how many of the delegates read this site.  Hi to Lauren, Jason, Nauman, Sanam, Katie, Tibor, David and many others.

UK Rewards credit and charge cards

I have done my best to sum up what I discovered in the bullet points below:

There appears to be a challenge to Amex’s view that the British Airways card is exempt from the 0.3% fee cap.  If you have read our previous articles on the new EU rules, you will know that directly issued Amex cards are exempt.  It seems that poorly worded legislation may mean that, whilst the BA card was never meant to be included (as it is directly issued by Amex) it may get dragged in.  This is linked to BA’s role in the process which means that the card is not strictly vertically integrated.

Travel loyalty cards remain hugely attractive for issuers.  Bad debt is very low.  Monthly spend is high.  Whilst very few people pay interest, those that do are paying it on large balances.

70% of co-branded credit cards are issued by retailers (M&S, Tesco, John Lewis, House of Fraser etc).  The travel segment is smaller than you imagine.

US research shows that the average spend on a co-branded credit card is 3x higher than the average spend on a ‘no rewards’ credit card.

48% of people in a recent survey felt that earning points was more valuable than earning cash via a cashback credit card

The EU fee cap is a seismic change for the industry.  However, the holders of travel loyalty cards are smart and look for value – simply slashing the rewards is not a viable strategy.

The loss of revenue will be partially clawed back from annual fees and a greater push to generate fees from, for example, balance transfers.

The way forward will involve the airlines and hotels investing more in their co-brand cards.  Getting their brand in your wallet drives loyalty and brand visibility – some of the value from this should be passed back.

With more loyalty cards requiring annual fees, the airlines and hotels will need to start giving back more in benefits.  IHG is leading the way here with Gold and Platinum status in IHG Rewards Club.  Perhaps we may see BA Bronze or Virgin Silver status given out with their premium (high fee) credit cards?

In terms of what the future holds, there were three interesting ideas I heard about:

Creating a new UK domestic payment scheme.  Many countries have their own domestic payment schemes which compete with Visa and MasterCard.  Carte Bancaire is very successful in France.  Turkey and Canada have major schemes.  Even Bulgaria and Serbia have them.  Such a scheme could be exempt from the new EU legislation.  They usually involve a JV with Visa or MasterCard to allow the card to be accepted abroad.

Creating a private credit card.  In the US, American Airlines issues a credit card which can ONLY be used for purchases with AA.  It is not branded Visa / MasterCard etc.  I doubt BA could make this work in the UK but potentially a coalition of major supermarkets, garages and travel companies could launch their own card network.

Apple Pay and Google Pay will play a major role going forward.  They are a threat – if you load your BA Amex details to Apple Pay then you don’t ‘see’ the card when you use it and the brand visibility is lost.  They are also an opportunity – Apple Pay could use Avios as a direct incentive to use its platform, or could re-sell them to merchants who would award them to customers who use Apple Pay.  

(My personal view is that it is logical for Apple and Google to launch their own credit cards and possibly even payment networks.  It would, for a start, be a good way of putting their excessive amounts of surplus cash to use.)

As you can see, there is a lot going on.  You should expect more big changes to your favourite travel credit card over the next year.

PS.  I also believe I know why the Marriott credit card has been temporarily suspended for new applications.  This link lists everyone called Marriott who has applied for, and received, permission from the Financial Conduct Authority to promote credit cards in the UK.  Guess who is not there?  Did they forget to get a licence?  Compare that to Hilton, IHG, British Airways etc.


best travel rewards credit cards

Want to earn more points from credit cards? – October 2024 update

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In February 2022, Barclaycard launched two exciting new Barclaycard Avios Mastercard cards with a bonus of up to 25,000 Avios. You can apply here.

You qualify for the bonus on these cards even if you have a British Airways American Express card:

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You can see our full directory of all UK cards which earn airline or hotel points here. Here are the best of the other deals currently available.

American Express Preferred Rewards Gold

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British Airways American Express Premium Plus

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The Platinum Card from American Express

40,000 bonus points and great travel benefits – for a large fee Read our full review

Virgin Atlantic Reward+ Mastercard

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Earning miles and points from small business cards

If you are a sole trader or run a small company, you may also want to check out these offers:

American Express Business Platinum

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American Express Business Gold

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Capital on Tap Business Rewards Visa

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British Airways American Express Accelerating Business

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Comments (118)

This article is closed to new comments. Feel free to ask your question in the HfP forums.

  • Toby says:

    Does anyone know if the higher BA Amex Premium sign up bonus is likely to remain beyond February? I have several cards which I am trying to reach spending targets on and could do with waiting a little longer before applying…..

    • Rob says:

      Put it this way, I doubt Amex would be paying for ads on HFP this week if it wasn’t going to end.

  • Andrew (@andrewseftel) says:

    Creating a new UK domestic payment scheme – I think the window on this is rapidly closing. Merchants are just about starting to see some of the cost reduction from interchange caps (and the big retailers got it straight away). I don’t think there will be enough enthusiasm on the merchant side to go back to higher interchange fees.

    Creating a private credit card – I think this is actually less likely in a post-interchange world. From a merchant’s point of view, the business case just got slashed. Might as well just do point-of-sale finance if you want to offer a specialized credit vehicle.

    Apple Pay and Google Pay will play a major role – evenutually, yes, but I think plastic will take a long time to die. They are very well positioned for mobile commerce transactions though. I find it hard to see them getting into proper credit cards, but something like the paypal credit model could work wonders in the developing world if they’re able to underwrite effectively.

    P.S. You’ll find the rest of the credit card industry at Grosvenor House tonight 🙂

    • The_Real_A says:

      To some extent this has already been done on the gift card side with SVM – the infrastructure is already in place with the major retailers. There is a “one for all” and “highsteet” cards that work across retailers. Completely accept this is a not a credit based system, but the disruption may come from alternative payment systems. It’s not beyond the imagination that a 10% margin given to gift cards could be used to fund a point’s based incentive. Avios “one for all” gift card digital wallet anyone?

      Alternatively how about a giffgaff style – consumer/community lead product that is designed by users. From an engagement perspective the travel community is about as engaged as they come… and not adverse to paying high annual fees if the value proposition is right.

  • Sheena says:

    Great article still waiting for a sign up bonus for the virgin Atlantic black card if you heard anything about that? It would seem perhaps the cc companies are taking the new changes better than we expected ?

    • Rob says:

      Not sure – there are no special MBNA bonuses at all at present, first time ever.

  • Sheena says:

    Maybe they are just a bit late like the tesco club card. Hopefully that’s all it is

  • Stephan says:

    OT but related to credit cards scrapping bonuses. Have Amex removed the 15000 bonus when upgrading to Platinum from Gold Rewards after spending £1000? Link doesn’t seem to work anymore

  • Talay says:

    Just to add that when negotiating with merchant acquirers recently for a new credit / debit car processing solution, I find that many have still not developed a pricing solution which encompasses the changes to interchange fees last year.

    However, if we get much below sub 1% on credit cards and Amex refuses to budge from 1.9% then the incentive to delete Amex will come much quicker. At present we take it but do not advertise it, no point in throwing money away 🙂

  • Sheena says:

    Upgrading from an Amex gold to a platinum for 20,000 reward points, is that applicable to everyone or just if you have the email?, I could be interested in that?

    • harry says:

      hasn’t been tested yet to confirm if the uninvited will get the welcome points, pls report back

  • Stephen says:

    Apple Pay certainly isn’t (or shouldn’t be) a threat to branding, as Rob suggests in his post. Every time I use Apple Pay I see a picture of the card appear on the phone right in front of me (this is also the case with an Apple Watch).

    In fact this potentially leads to more brand exposure than a contactless card, which doesn’t need to be taken out of a wallet, etc.

    The problem I’ve seen so far, from a branding pov, is with mbna. All my Amex cards, and my normal bank cards, have branded images to represent the card. However, my Virgin Black cards do not – they are shown as a generic mbna Rewards (Visa) and Rewards+ (Amex) cards – apart from that they are plain black or white, with nothing at all to indicate they are my Virgin cards. If I had more than one mbna card I wouldn’t be able to tell them apart!

This article is closed to new comments. Feel free to ask your question in the HfP forums.

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