Credit cards help ramp up the points

Tuesday, April 08, 2008
Canadian consumers know from experience how credit cards ramp up the collection of travel rewards.
"I use my CIBC card whenever I can, so that I accumulate points and can redeem them for travel and to buy gifts for friends and family," says Ottawa resident Michele Ade.
CIBC's Aerogold Visa gives 1.5 Aeroplan miles for every dollar spent and provides a guarantee that the cardholder's Aeroplan points will not be lost because of 12 months of inactivity in point use.
Several major credit cards offer rewards through Aeroplan or Air Miles. As the competition for customers among credit card companies offering travel-reward programs heats up, the rewards are greater than ever.
More flights on more airlines with fewer restrictions are among the improved offerings. It is possible to use points for more purchases other than flights. There is also competition in the credit card fee structure and in the additional benefits offered.
American Express gives cardholders various ways to accumulate points through a number of programs. Amex has been one of Aeroplan's credit card partners since 2003. It also has its own card offering reward miles, and has just expanded its partnership with Air Miles.
In February, American Express and Air Miles launched the Air Miles Platinum credit card, with which cardholders can earn 50 per cent more reward miles at sponsor retailers.
Later this spring, American Express will offer a new no-fee travel rewards card with unlimited travel choices and redemptions with no travel restrictions. Through its Blue Sky credit card program, customers can redeem points for flights on any airline with no restrictions, or for hotel rooms worldwide, car rentals at any agency, trips on any cruise line, or travel packages booked through any tour provider.
The Bank of Montreal's Mosaik Mastercard offers Air Miles as part of its 2004 agreement with WestJet.
"The strength of BMO Mosaik MasterCard's partnership with WestJet and Air Miles allows us to offer a wider range of cardholder choices than any other travel rewards credit card on the market," said BMO financial group chairman and CEO Tony Comper, when the program was announced on April 23, 2004. "For the more than 15 million Canadians who collect Air Miles reward miles, their reward miles can take them further than ever."
The Royal Bank Avion Platinum Visa Card gives holders the ability to earn one RBC reward point for every dollar spent. The points can be cashed in for travel through the RBC Travel Rewards Centre, a full-service travel agency. The travel points can be used for flights on a number of airlines, including Air Canada. Because RBC travel points are not directly linked to Aeroplan, travellers have a wider choice of companies and flight times.
The Scotia Gold Passport Visa claims that "no other rewards card gives you more flexibility." As with the RBC Avion, points earned can be used on numerous airlines. Scotiabank promises, "With the Scotia Rewards program you can book flights on any airline, to any destination, at any time of the year, without blackout periods, limited seating or Saturday night stay restrictions."
The Toronto Dominion Gold Travel Visa runs its travel rewards program through Carlson Marketing. It also promises travel on a variety of airlines with no blackout periods and notes that "with TD points, you can travel any time of year, including peak periods, even during seat sales. Unlike other travel reward cards, you are not limited to 'reward' seats."
"When you travel a lot for business as I do," says Tourism Industry Association of Canada president and CEO Randy Williams, "travel reward points for hotels and airlines are a great fringe benefit."
Most of the credit cards involved in travel reward programs charge an annual fee, usually between $90 and $120, though the top price is $499. Some also offer a supplemental card at a reduced rate, usually $50. They may require a minimum annual income, usually from $25,000 to $35,000 and frequently offer signing or renewal bonuses in the form of points towards flights or merchandise.
The higher-end cards often include access to Air Canada's Maple Leaf Lounge or other airport lounges and travel or accident insurance as additional cardholder benefits. Some also include baggage and trip cancellation insurance, car rental insurance, hotel burglary insurance and purchase protection.
Diners Club cards, issued by Citibank, were the world's first credit cards. They also carried the first card-based travel rewards program in the early 1980s. Travel points, earned at the rate of one point for every dollar spent, could be redeemed for travel on most airlines. Diners Club International today offers Air Miles through Mastercard