Is a frequent flyer credit card right for me?

If your lifestyle involves plenty of travel, catching flights and purchasing travel-related products and services such as hotels and rentals, a frequent flyer credit card could be a great choice. These cards work best if you spend often; you get the most out of your membership by making purchases and earning points. Membership also opens doors to other benefits such as concierge services, access to airport lounges, priority airport check-in, complimentary upgrades along with a rolling program of special offers and discounts. Credit cards for frequent flyers usually feature insurance policies including travel insurance and purchase protection. If you are likely to overspend, don’t always clear the balance in full and have an ongoing debt on your credit card account, the cost of using your credit card outweighs the benefits of the program. And since these cards usually have an annual fee, if you don’t travel often or use your card infrequently, another type of card would be better. Note that cash advances, buying foreign currency, balance transfers, gambling payments and other types of transaction are usually exempt from the rewards scheme and earn no points.

What kinds of restrictions do frequent flyer credit cards have?

Each frequent flyer program has its own set of rules and regulations regarding points capping and expiration. Some cards operate with a tiered points system, where you earn more when you spend at places connected to the program. Entry level frequent flyer cards for low spenders tend to place the most restrictive points capping in place - which is okay if you're not intending to spend more than a few $1,000's each month.

How much does it cost to join a frequent flyer program?

You need to enrol to become a member of a program. Most programs are free, or free with a sign-up, with the exception of Qantas Frequent Flyer, which charges a one-time fee of $89.50 to join, although the fee is occasionally waved during promotions. Depending on the program, you must earn or spend points at least once during a set period to keep your membership current and not lose your points. For Qantas, it's once every 18 months; for Velocity, it's at least once every 36 months, for example.

How easy is it to be approved for a frequent flyer credit card?

The criteria and the process is the same as all other credit cards, but because these cards are premium products the bar is higher. Banks look at your credit rating, verify who you are and verify your income. That being said, not all frequent flyer credit cards require high earnings. Just make sure you have no bad credit history and you should be okay.

What’s the best way to maximise earning rewards points?

There are many ways to racket up your points total but you shouldn't go out of your way to spend more in order to earn more points. To get the most earning potential out of your card you need to be spending often and earning plenty of points on those purchases. Depending on your circumstances it might be a good idea to see what regular payments you can move to your credit card – things such as weekly groceries, fuel payments and direct debits for bills – so that you can earn points on your normal payments. Also, some of the frequent flyer credit cards will earn up to 5 points for every dollar spent when you spend at a restaurant or store which participates in that rewards program. That's an idea to get you thinking.

Can low spenders make a frequent flyer card work?

Yes. It all comes down to the maths and everyone is equal in that regard. If you spend the money on the right cards, your points will add up and the reward can be redeemed. It might take a little longer if you are a low spender, but it will all still work out. The bonus points that you get at signup or upon first spend will also help get you going. Low spenders should probably aim for a frequent flyer card with the lowest annual fee so that they can faster reach the break even point where the reward benefit equals the cost of holding the card. Again it’ll come down to how and when you redeem your points.

Do balance transfers and cash advances earn frequent flyer points?

No, sadly they do not earn points. You should also be aware that frequent flyer cards have higher interest rates than normal low rate credit cards because it is a premium product.

Is it a good idea to earn points across different frequent flyer programs?

Yes, if you fly frequently enough, spend within your means, repay your monthly credit card in full, and need more flexibility to fly with various airlines, then it is an idea worth considering. Mind you, managing your multiple credit cards and airline program balances could become complex. One way around this would be to apply for a card from American Express that has Membership Rewards. The benefits of earning Membership Rewards points is that your points balance can be transferred to a number of airline frequent flyer programs, so you aren’t tied to one specific airline or alliance.

Do people sign up to get the bonus flyer points then cancel their card?

Yes, people who chase the extra points do this. There’s nothing to stop you from getting a card (subject to approval), pocketing the signup bonus points and then closing the card down later on. Mind you, it would need to make sense financially to do so because almost all frequent flyer rewards cards have annual fees.

How often can I churn frequent flyer credit cards for their signup bonuses?

Credit card churning is the well-known art of applying for credit cards with sign-up bonuses, hitting the minimum spend requirements, and then cancelling the card and repeating every few months. It means you earn as many points as possible in a short amount of time or in reasonably quick succession. How does it work? And can you be penalised? Firstly, your credit rating will take a small hit if you apply for too many cards. A cautious approach here is better since it gives your credit rating a chance to recover before applying for the next card. Therefore, before deciding if you want to collect points through churning, take a look at the finer points of this strategy. Make sure you’re checking the fine print on offers and know what you’re signing up for before diving in. To lessen the impact on your credit rating, only apply when you are confident of success, which means checking your credit rating to assess the likelihood of success. Multiple open credit cards will reduce your chance of getting approved for a further line of credit so be sure to close the card accounts once you have hit the minimum spend and are ready to apply for the next signup bonus card. In theory, you should be able to meet the bonus point spend requirements and have the capacity to repay that spend in full each month. Paying off the balance in full and closing down the card account should help you avoid or limit the interest charges and annual fees.

Will I lose my frequent flyer points if I close down my frequent flyer credit card?

No, that won't be a problem. The points that you earn in a frequent flyer program are separate to your credit card. So if you’re cutting up a card or just switching to another card your points won’t be affected.

How can I spend my points?

Points can be redeemed for flights with affiliated airlines: you can redeem Qantas Frequent Flyer points, for example, for flights with Qantas, British Airways and American Airlines, among others. You can also use your points for hotel accommodation, resorts and holiday packages, car rentals, entertainment and leisure services, retail products and many other options. Frequent flyer programs usually allow you to pay partly in points and partly with money. The credit card’s frequent flyer program usually gives you access to an online account where you can check your balance, browse for products and services and learn about special offers.

Are all frequent flyer points worth the same across different points programs?

The short answer is no. Why? Because there are so many variables at play. Here are some examples. Transferring from one rewards program to another: You may be earning points with a rewards program run by a bank. In this case, you typically have the option to transfer points to a frequent flyer program such as Qantas Frequent Flyer or Velocity Frequent Flyer. However, one rewards point does not necessarily equate to one frequent flyer point. Different programs, different value. For example, Program A may require 100,000 points for a flight worth $1,000 if booked with cash, making one point worth 1 cent. Program B may offer flights in the same cabin on the same route and require 125,000 points for a flight worth $1,000, which would value one point worth less than 1 cent. However, Program B may also have flights to a different destination that is still attractive to you but only require 100,000 points for a flight worth $1,500 if booked in cash, valuing each point at 1.5 cents.

Compare Frequent Flyer Credit Cards That Earn Points

Frequent flyer credit cards

Apply for a frequent flyer card to earn points as you spend and redeem them for flights and upgrades with your favourite airline.

By Yvonne Taylor | Verified by David Boyd | Updated 10 Apr 2024

A frequent flyer credit card is a way to earn the frequent flyer points and status points that can make travel a much better experience. Here's how they work and what to look for when comparing offers.

What is a frequent flyer credit card?

Frequent flyer credit cards earn frequent flyer points per $1 spent on eligible purchases made with a credit card linked to a specific airline’s frequent flyer program.

Points earned using the cards are credited directly to the cardholder’s frequent flyer points account with the airline. The points can be exchanged for award flights and seat upgrades, or other rewards and merchandise selected from the frequent flyer program’s online catalogue.

Frequent flyer credit cards often come with a number of perks and benefits designed to make travelling better, for example, airport lounge access, free flight vouchers, complimentary travel insurance, and flight inconvenience insurance. There is often a substantial sign up bonus too.

How frequent flyer credit cards work

The way you earn frequent flyer points varies between different frequent flyer membership programs, but they generally function in the same way as other types of rewards scheme: you earn points each time you use your card.

Typically, there is a flat rate of earning for every dollar spent on your credit card and a bonus rate for purchases with the program’s partners such as affiliated airlines, hotels, retail outlets and other partners. Different credit cards earn points at different rates within the same program – gold and platinum cards often earn more points than standard cards – and you may be able to earn bonus points during introductory offers. Black cards typically have the strongest earn rates, caps, and most generous welcome bonuses.

What is the best frequent flyer credit card?

The best frequent flyer credit card is the one that suits your individual lifestyle. It's a decision only you can make since there is no overall best card to suit everyone equally.

Things to consider when choosing which card to apply for.

Preferred airline. For domestic Australian flights, that means choosing between Qantas or Velocity. But if you want to travel internationally, it would be worthwhile considering available partner airlines. Will you be able to use your points for the airline you want to fly long haul with?
Flexibility. Do you want to earn Qantas / Velocity points and fly with them and their partners, or earn into a program that lets you transfer out into more rewards programs. The latter option can be beneficial if you don't mind so much who you fly with and like having more options.
Perks. What do you value most? For example, are you more interested in airport lounge passes or status credits?
Sign up bonus. Will you be able to spend enough to hit the spending target (if there is one) or will it mean buying stuff you don't need?
Monthly spend. If you are a big spender, it might be worth looking for a card with no cap or one that's high enough for your projected spend.

Types of frequent flyer credit card

Broadly speaking, these are the main types of frequent flyer credit card in Australia.

Qantas Frequent Flyer credit cards. If you are already a member of Qantas Frequent Flyer, link your card and earn Qantas points per $1 spent. If not, you can get a Qantas Frequent Flyer account for free with some cards.
Velocity Frequent Flyer credit cards. Earn Velocity points per $1 spent. Many of the banks' own rewards programs let you transfer points into Velocity Frequent Flyer.
No annual fee frequent flyer credit cards. Expect to get a lower earn rate per $1 spent, smaller sign up bonuses, and fewer travel perks.
Frequent flyer credit cards for businesses. Earn points on money your business was already spending.

What frequent flyer points can you earn?

The main frequent flyer programs directly linked to credit cards issued in Australia are Qantas Frequent Flyer and Velocity Frequent Flyer. There are also credit cards that are linked with Emirates Skywards and Jetstar Dollars.

But what about other frequent flyer programs like Air New Zealand Airpoints, Singapore Airlines KrisFlyer Miles, Asia Miles, Thai Royal Orchid Plus, and Malaysia Airlines Enrich?

For those, there are many indirect frequent flyer cards that let you earn points and transfer them out to a partner program.

A good example of this is Membership Rewards, which lets you transfer points to a number of partner airlines. Likewise, points earned from credit cards linked with CommBank Awards, NAB Rewards, ANZ Rewards, Altitude Rewards, Amplify Rewards, and HSBC Rewards, can be transferred to a number of airline partners (specific partnerships vary per bank).

The exchange rate between in-house rewards programs and frequent flyer programs is rarely 1:1. Credit card providers will notify their cardholders of the prevailing exchange rate, and of any changes in the exchange rate. Typically, more than one rewards point is required in exchange for one frequent flyer point.

How much are frequent flyer points worth?

Sadly, 1 frequent flyer point is not worth $1 dollar. That would be amazing! You’ve got to think of the points you earn as a separate currency to the Aussie dollar.

What you spend your points on will determine the value you are able to yield from those points.
Redeeming your points for a $100 gift card is easy and convenient, but will not be the best value.
Redeeming your frequent flyer points for a premium economy seat or business class seat on an international flight with most airlines will yield a much higher points-to-dollar value.

How to compare frequent flyer credit cards

When comparing credit card offers, examine all the features, rates, fees, and the details of the frequent flyer program before deciding what to apply for.

Program partners. The program should involve airlines, hotels, retailers and other companies that you regularly spend with using your credit card and offer the opportunity to redeem the points for rewards you want to use.
Earn rate (points per dollar spent). The value of the points you earn is very important. You should take the time to see how points are earned and the number of points needed for rewards to judge how much value for money the program really provides. For example, a card may offer 3 points per dollar, but the real value of each point may be lower than a card that offers 1 point per dollar, depending on the amount needed to redeem a ticket, restrictions and blackout dates, and so on.
Introductory offers and sign up bonuses. Banks regularly offer bonus points during an introductory period, which can be a great opportunity to quickly earn rewards, but you should always examine how the program changes once the offer ends. Many cards also often run award sign-up bonuses.
Extra benefits. Frequent flyer points credit cards usually feature other benefits alongside the rewards program, including travel insurance, lounge access (often via Priority Pass), concierge service, and purchase protection. In terms of travel insurance, the level of cover can be dramatically different from one card to another, with some offering cover you and your family internationally and domestically, while others only offer cover for you while overseas.
Interest rates. As with any credit card, one of the most essential features to look at is the interest on the account, including purchase and cash advance rates. You want to use your credit card for everyday purchases, not just during travel, so it should feature a competitively low interest rate. Assuming you travel regularly, you should also research foreign exchange fees and foreign transaction fees.
Annual fees. Many of these cards feature a significantly higher annual fee than standard credit cards. You should calculate how this balances with the credit card’s other features to make sure that the cost of using your card doesn’t negate the benefits.

Frequent flyer credit card pros and cons

As with any financial product, you have to weigh up the benefits against the drawbacks.

Pros

Earn points per $1 spent. Get rewarded for spending the money you were going to spend anyway.
Sign up bonus. Most frequent flyer credit cards come with a substantial sign up bonus.
Cardholder perks and benefits. Many of the higher level cards come with airport lounge access and complimentary insurance. Some may even have travel credit vouchers redeemable for flights and status credits.
Turn tax into rewards. Some cards let you earn on ATO purchases, but often at a reduced rate.

Cons

Caps and thresholds. Some cards have a limit on the number of points that can be earned.
High annual fees and rates. Most cards that earn points charge an annual fee, which can be high. If you don't use its benefits, or carry a balance, the value of rewards can be negated.
Sign up bonus conditions. In order to get the bonus points, you will usually have to spend a certain amount with a certain amount of time.
Airlines can devalue their program. If this happens, it may cost more points for upgrades and redemptions.

Other ways to earn frequent flyer points

Members of airline frequent flyer programs can obviously earn frequent flyer points by flying with the airline (or its partner airlines) when those flights were paid for with cash or a credit card. It’s not possible to earn points by taking flights which were themselves purchased by redeeming points. Credit cards linked to frequent flyer programs often offer a higher points earning rate for purchases of flights and seat upgrades made using the linked credit card.

But there’s also another way to earn frequent flyer points, simply by shopping at the Qantas Online Mall or the Velocity eStore.

When you’re ready to purchase Australia’s favourite brands from the nation’s most popular retailers (including eBay), simply access their websites by clicking on the link at one of these airline online shopping program sites first.

Your purchases will automatically be tracked and the frequent flyer points earned – up to 10 points or more per $1 spent – will be credited to your frequent flyer points account.

If you pay with your frequent flyer points credit card you can earn points twice – once for shopping via the airline’s online mall and once for paying with your frequent flyer points card.

Qantas also offers more ways to earn points, including:

Taking Uber rides
Dining at selected restaurants
Using the Qantas Wellbeing app
Buying Qantas Insurance or Qantas Wine
Using GoCatch or ingogo apps for taxi rides
Booking Airbnb stays via Qantas
Catching a movie at HOYTS
Ordering a meal via Deliveroo

The Velocity Points program has similar deals. Some of the ways you can earn Velocity Points are:

Converting flybuys earned at the Coles group into Velocity points
Shopping in-store and online at selected retailers, including Freedom and Snooze
Booking a car with Europcar, Hertz or Thrifty
Making Flexicar or Ola bookings

And once again, paying for any of this with a frequent flyer credit card lets you effectively double dip.

Frequent flyer credit cards

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