Jack Han reports on the credit card market shake up following the new brands in town.
December 1, 2009
Credit card rewards are becoming more competitive with the introduction of Jetstar‘s new low-rate credit card, the Jetstar MasterCard, which aims to compete with existing bank credit cards on rates and rewards.
Jetstar CEO Bruce Buchanan presented the new low-rate credit card, saying that “we aim to do for credit cards what Jetstar did for low fares airline travel in Australia when we launched back in 2004 – to present consumers a choice with real benefits and with a low every day rate…”
The partnership with Macquarie Bank is the airline’s first venture outside of the travel industry, offering credit card users a low-rate MasterCard or Platinum MasterCard.
“The Jetstar MasterCard will reward users with not only low rates, but also a really simple and valuable rewards program to earn Jetstar Dollars.” says Buchanan.
‘Jetstar Dollars’ competes against existing rewards programs by allowing spenders to redeem points for Jetstar Flight Vouchers, which can be used for 50 domestic or international destinations.
By earning $0.01 in Jetstar Dollars for every dollar spent on the standard MasterCard, and $0.02 for every dollar spent on the Platinum MasterCard, Jetstar claims that its customers can earn trips up to 20 times faster than with its competitors.
Jetstar, owned by Qantas, is also introducing the Qantas Frequent Flyer program as a reward option for its credit card holders, making it the first credit card to offer multiple flight rewards.
As with every credit card however, Australian spenders are weighing up the benefits with the costs before signing up to a credit card rewards program. By earning $0.01 per dollar spent, holders will have to spend $2,500 for a $25 flight voucher, or $10,000 for a $100 voucher.
While ‘lite’ credit cards typically offer the lowest rates, Jetstar’s MasterCard is one of the only cards to offer a low rate along with a rewards program.
At the end of the day, every credit card provider will have to rethink their offers to compete on both rate and reward, so it’s up to you to compare the upcoming deals online, and find the credit card that suits your travelling needs.