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Will the UK be the test market for the new Star Alliance credit card?

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The Star Alliance airline grouping made a surprise announcement this week – it is to trial a Star Alliance-branded credit card in an undisclosed country this year.

The card will allow transfers to all 26 Star Alliance frequent flyer programmes. You would earn an intermediate currency – let’s call them ‘StarPoints’ for now – and then be able to transfer your StarPoints into the 26 individual schemes.

This would cover schemes such as Miles & More, Singapore Airlines KrisFlyer, Air Canada Aeroplan, United Airlines MileagePlus and many more. You would be able to arbitrage each trip, picking the scheme with the award chart which offered the lowest mileage and taxes for the flight you wanted.

Why would Star Alliance trial an alliance-wide credit card here?

There are good reasons and bad reasons why the United Kingdom would make a good test bed for a Star Alliance credit card.

On the positive side:

  • there is no single dominant Star Alliance carrier operating out of the UK. Launching a Star Alliance credit card in Scandinavia, Germany, Austria, Switzerland, Belgium, Poland or Portugal would directly compete with products offered by a strong incumbent Star Alliance airline.
  • virtually every airline in Star Alliance flies to the UK. Each will have a few thousand core flyers who would be keen to get a Star Alliance branded credit card as the next best thing to having one issued by their preferred carrier
  • the UK is, by a large margin, the most pro-credit card country in Europe. If Star Alliance was planning to trial its card in Europe, the UK is the obvious place.

On the negative side:

  • the UK credit card market is very competitive. Whilst the Miles & More Mastercard was popular with those looking a generous non-Amex product, this gap has now been filled by the two Barclaycard Avios Mastercard cards. Is there space for a Star Alliance product?
  • I would question how generous a Star Alliance branded product in Europe can be, because the alliance will effectively be buying miles off the individual carriers. The Barclaycard Avios card is there to drive a new generation of customers to Barclays, whilst the Virgin Atlantic credit cards are a true joint venture, with the airline sharing in FX and interest revenue. Assuming that Amex cannot be the issuer due to its BA relationship, Star Alliance may struggle to afford more than 0.5 miles per £1. If Star Alliance wants to make money off this product, it may need to look outside Europe where interchange fees are uncapped.
  • one key attraction of the UK Miles & More credit card was that holding it stopped your Miles & More balance from expiring. This is unlikely to be a benefit of a UK Star Alliance credit card, even if you transferred the StarPoints you earned from it to Lufthansa. There is no certainty that ex-Miles & More cardholders would want this product.

Irrespective of whether the Star Alliance credit card does launch in the UK first, this is a potentially huge development for the industry. It opens up the possibility of a competing oneworld credit card, which would allow you to transfer miles into not just British Airways but also American Airlines AAdvantage and other ‘low charges’ programmes.

You can read more about Star’s plans in this Bloomberg article.

Our article on the best UK Star Alliance credit cards on the market at the moment is here. A broader article on the best Star Alliance frequent flyer programme for UK residents is here.

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Comments (44)

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

  • Axel Heyst says:

    I was able to renew my KrisFlyer Gold this year, without flying Singapore by converting my HSBC reward points at 1 to 1 with a promo that counted for status at 5 to 1.

  • Chrisasaurus says:

    On the Asda front, anyone know anything of Jaja? Heavy PE involvement, look to be trying to eat Newday’s lunch?

    • Owen Rudge says:

      Jaja took over the AA credit cards from
      Bank of Ireland – my FuelSave card is still going strong. Their web site/app was initially very poor compared with what had gone before, and is still somewhat glitchy, but has improved over time.

    • Froggee says:

      They took over the Post Office money credit card when Post Office exited and I can’t blame their efficiency in closing my account when I asked them to.

      • lumma says:

        The current post office cards seem to be more aimed at the poor credit market, saw a “purchases and balance transfer” card recently. 3 months 0% for both…

      • RussellH says:

        I still have my Jaja ex Post Office card, but apart from using it the once to activate it, it has just stayed in the drawer.

  • Ian says:

    I would say that Norway is more pro-credit cards than we are.

    • masaccio says:

      This geek had to check. Yup 66 million cards in the UK, 13 million in Norway. Populations 70 and 5 million respectively.

      UK a massively bigger market by numbers though. Another data point: 25% of payment cards in Germany are credit cards. When we lived there ages ago, many shops were cash only.

      • PMG says:

        On Germany, luckily the pandemic has meant more places now accept card…

        Still some places in the countryside that are cash only or have limits on paying by card but much better now 😊

        • RussellH says:

          Used to be that most places in Germany would accept a German debit card, which used the local girocard payment network. Even if V-pay (Visa) or Maestro (M-Card) branded too, that was only for foreign use.

          But things **are** changing. Many banks are now issuing standard Visa Debit cards (and I assume others are issuing Debit MasterCards) which are valid world wide (V-Pay was a Europe only product).

          I do not know if girocard has been would up – but my new German Visa Debit card does not have the girocard logo on it.

          • Distichon says:

            There was a report in German news that I read recently. Basically, girocard is struggling because they do not have their own international payment system. They piggy backed onto v-pay and maestro(?), but those are being discontinued, so girocard is in a bind. Apparently some banks are trying to spin up their own competing product for international or at least inter-European payments, but not even all German banks are interested, so I’m not sure this will go anywhere. I’d say the likeliest outcome is that giropay will die as it’s being replaced with debit cards.

          • Harrier25 says:

            Germany will only be accepting Rubles soon to allow them to pay for all that Russian gas! 😂

        • TJomes says:

          “The Pay Off: How Changing the Way We Pay Changes Everything” by Gottfried Leibbrandt (2021) is a good read about the past, present and future of payment, well-written for a non-specialist and full of interesting nuggets and anecdotes.

      • RussellH says:

        Surely one of the things that drives Credit card use in the UK is our unique S75 rights.
        Even though huge numbers of people are still totally unaware of them, I suspect that those who are aware will just about always use a credit card.

        • Rui N. says:

          S75 is not unique , a few other countries have something similar, notably the US. As you said, huge numbers of people have no idea about S75 (I’ve never met a single person that has heard about it), so it’s doubtful that’s the reason why the UK uses CCs so much.

        • JDB says:

          I think the main driver in the UK is unfortunately the desire to use the credit facility. That is much less common in other European countries whose citizens are historically more careful and dislike debt.

  • masaccio says:

    If it gave 241 or similar I would jump on it. I often see Star Alliance cash fares for much less than One World for the leisure routes I want to fly. I will never fly enough for BA lifetime Gold so this could nudge me to switch alliance.

    • Ronster says:

      Good afternoon

      If this takes place then BA/Amex will have to look at offering 2-4-1 on all oneworld flights

      That would be a holy grail benefit.

      That and 0 fx charges and guaranteed silver/gold benefits dependent on spend.


  • NFH says:

    I believe that the new card will almost definitely be issued the UK by Cornèrcard UK to replace the dual Diners Club / Cornèrcard cards, which were discontinued just over a year ago. A replacement card by Cornèrcard UK has been in the pipeline for many months now, during which time Miles & More expiry dates have been extended several times for previous holders of the dual Diners Club / Cornèrcard cards.

    • CamFlyer says:

      My reaction was that it is also likely to be the U.K., as a large and wealthy market with no dominant *A carrier.

    • Andrew. says:

      Why not MBNA?

      They were the key partner with BMI in the old days. Given their experience with white labelled products across their own brands, I suspect they could have retail side of things ready within 24 hours of receiving the branding JPEGs.

      • Rob says:

        That post has been there since the old card closed – well, not true, it was amended later to become more vague – and I have heard nothing to believe that a launch is imminent.

  • Peter says:

    Let’s hope it’s from creation :p

    • Clive O says:

      I do hope you’re joking re “Creation”!!!. I have had atrocious issues with their customer services. I’m so sorry Marriott chose them as their UK. I only have this and Bonvoy Amex because I have close to 750k AA miles and that’s the only way to transfer miles to keep the account alive. Roll on / bring back an American Airlines* backed credit card. (Yes I know there are probably better airlines but I am “locked in” to AAdvantage programme)

  • Blair Waldorf Salad says:

    It’s dead on arrival if transfer times from card points to chosen scheme aren’t immediate. Who wants to price up a redemption via Krisflyer, wait a few days to find it no longer available, then have to transfer even more points out to try again with Miles&More

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