Airline Miles Reward Credit Cards

Everyone likes the idea of free airline miles. It is an attractive idea to get free travel just from using one credit card instead of another.

Credit cards are now as good as actual cash. Many people prefer charging their purchases on cards instead of bringing along cash when they go to stores for security reasons.

Almost all people who are eligible, having good jobs and able to pay, are owning credit cards. Furthermore, credit card issuers are underpinning the robust trend and are constantly launching initiatives to further lure consumers into getting cards and purchasing using the plastic items.

Amid all the strategies to boost credit card transactions, many credit card firms are starting to hit the bull's eye so they can significantly increase the volume of credit card account holders and transactions.

Of course, the move is aimed at earning more. Whenever customers use their credit cards for any transactions, whether for merchandise purchases or bill payments, it is logical that the credit card issuers generate profits because interest rates and charges apply to credit cards.

Now, credit card companies are ramping up their offers to reward credit card users by offering subsidies to their travel fares. Yes, because many people basically like traveling through airlines, credit card firms are targeting that interest to be able to convince more clients into opening credit card accounts or use the cards for transactions.

Credit cards' reward systems

To be able to lure more clients and boost revenues, credit card issuers are all offering programs that would reward customers for frequently using credit cards.

The reward systems for credit card transactions are so popular that almost all minor and major credit card firms are offering them. After several years of offering the programs, it has been proven that the strategy really works.

According to studies, many credit card holders are now more motivated to pay bills and pay purchases using credit cards just to earn reward points that would lead to lucrative incentives when accumulated.

From discounts to freebies, credit card rewards are offering more. Airline miles reward programs are now among the most popular promotions being introduced to the market.

Airline miles rewards

Airline miles rewards programs work just the same as the regular reward system offered by almost all credit card firms.

The program works by convincing consumers to increase their spending and transactions using the credit cards. In return, for each transaction, certain points are earned.

When the points accumulate, they could be equivalent to as much as one-way air travel for free! The strategy has been effective as consumers consider the current high air fare amid expensive fuel costs.

It is also interesting to note that some customers even purchase goods they don't really need and even convince friends and relatives to use their credit cards just so they could earn points.

But as an analytical consumer, would you care to know if the airline miles rewards programs are really worth it?

Airline-sponsored vs. bank sponsored credit cards

There are two major types of credit card products out in the market today. This grouping is in terms of airline miles reward programs. They are the airline-sponsored and the bank-sponsored credit cards.

Airline-sponsored credit cards are those that are issued by a particular airline. When you use the card, the points you earn will be used for your future air fare in that carrier.

Bank-sponsored credit cards are seen as more flexible by more consumers. That is because the reward points accumulated using the card can be used in many other airlines rather than only in one, as the case in airline-sponsored credit cards.

Many credit card holders in that sense see bank-sponsored credit cards' air miles rewards programs as more beneficial and attractive.

Special charges on credit cards under airline reward systems

An in-depth industry study over these rewards programs has found that these credit cards usually charge more compared to the regular credit cards, which are not enrolled through the incentive system.

Take note that credit cards with airline rewards require annual fees that are usually waived on regular credit card products. In some instances, interest rates on airline-reward cards are higher in comparison to the regular cards' rates.

These findings underscore the tactic at how credit card issuers are desperately doing all they could do just to boost transaction volumes and credit card holders' numbers.

In the end, an analysis of the situation will surely lead you to conclude that the reward programs are actually funded by yourself.

Though, at the first glimpse, the offers are good deals, it is recommended that you analyze the situation, the terms and the conditions of the reward systems before finally enrolling into those special lines of credit cards.