Why Amex should change its airline fee credit right now — and how they can do it
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Editor’s note: This story has been updated with the latest information.
Appetite for travel is beginning to reemerge, but that doesn’t mean everyone is ready to leave and explore just yet. People are changing how they travel for the short to medium term and funneling more of their spending towards non-airline transportation (myself included).
Some of the major credit card issuers — including Amex, Citi, and now, Chase — have made travel-heavy cards more usable at a time when, well, travel isn’t so heavy. For two of these issuers, that includes allowing travel credits to be used on non-travel purchases.
However, there’s an odd man out: American Express.
Amex’s already restrictive airline-fee credit has always been more difficult to use than the equivalent “travel” credit from both Chase and Citi. Will that change now, in the midst of the coronavirus pandemic? Amex hasn’t shown many signs it will, but here are four reasons why it should.
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Travel and airline credits, at a glance
The major trio of issuers — Amex, Citi, and Chase — each have at least one consumer premium card in their lineup with an annual fee of $450 or higher. Each card also comes with an annual travel credit to help offset the annual fee.
- The Platinum Card® from American Express (up to $200 airline-fee credit)
- Citi Prestige® Card ($250 general travel credit)
- Chase Sapphire Reserve ($300 general travel credit)
The information for the Citi Prestige card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.
All but one card has made it easier to use that credit in light of the coronavirus pandemic and the restrictions on travel: the Amex Platinum.
Amex needs to catch up to Chase and Citi
Both Chase and Citi have expanded their (already broadly defined) travel credits to include common spending categories like dining, grocery stores and restaurants.
Chase Sapphire Reserve: Through June 30, 2021, Chase Sapphire Reserve cardholders can use their $300 travel credit toward grocery and gas purchases. Cardholders will earn 3x on up to $1,000 in monthly grocery store purchases between Nov. 1, 2020, and April 30, 2021. From now through Dec. 31, 2021, Sapphire Reserve cardholders will get up to $120 in statement credits to cover monthly Peloton Digital ($13) and All-Access ($39) memberships.
Both Chase and Citi already had a fairly generous interpretation of the travel credit to begin with, including airlines, hotels, Airbnb, Uber, transit, and much more. Now, these changes expand the credit’s possibilities even further to include essential, everyday spending categories.
Most importantly, these moves instill confidence in current cardholders that they’ll be able to use up their annual credits despite the potential reluctance to travel.
Airline fee credits are (mostly) useless if you’re not flying
Flying is not on everyone’s radar right now. And that’s okay. However, the obvious must be said: it’s hard to use an airline fee credit if you’re not taking to the skies.
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Amex’s airline fee credit has also always been the most limiting of the bunch, with only airline incidental fees triggering reimbursement.
That means you (typically) cannot get compensation for buying an airline ticket for the future, but you can use the $200 credit toward things such as seat selection fees and checked bag fees. That isn’t super helpful at the moment, especially if you’re not comfortable flying for the rest of 2020. Reimbursement is also reliant on merchants to properly code transactions.
Besides the personal Amex Platinum, these cards also offer an annual airline fee credit:
- Hilton Honors American Express Aspire Card (up to $250)
- The Business Platinum Card® from American Express (up to $200)
Limited-time credits only go so far
Amex has taken a slightly different approach when it comes to convincing cardholders to spend dollars on their premium cards. For instance, with the personal and business Amex Platinum cards, Amex has added entirely new and expanded monthly credits to the mix.
On the personal Amex Platinum, this includes up to $320 in statement credits on select streaming and wireless telephone services purchased directly from U.S. service providers (up to $20 per month) from May through December 2020.
If you’re not spending in these categories, you can’t take advantage of the benefit. Instead of changing the airline fee benefit to be more inclusive, Amex is introducing new ones — which may or may not be helpful for existing cardholders.
However, the new credits above do a lot to offset the Platinum card’s $550 annual fee (see rates and fees), and in fact, you can come out ahead by maximizing all the credits (including Uber and Saks). Still, I would also like to see Amex make the card’s up to $200 annual airline-fee credit more usable.
Give cardholders confidence by making benefits relevant
Cardholders will stay more loyal and use a card more often if it’s relevant to their needs. In the shorter term, this can easily be done by making credits more versatile.
This doesn’t just apply to the Amex Platinum, but also to cards like the Hilton Aspire and Amex Gold. While the Aspire’s up to $250 Hilton resort credit was made more flexible — applicable towards U.S. restaurants, including takeout and delivery this past summer.
Similarly, the Amex Gold Card hasn’t had any COVID-related updates whatsoever. However, since that card is heavily skewed towards bonuses on restaurants and groceries at U.S. supermarkets already, I can also see why Amex has been reluctant to make moves.
I’d love to see the Amex airline credits to be able to be applied to bonus categories such as groceries, restaurants, or even something like Amazon. There’s no need to reinvent the wheel with new categories. Even the same bonuses from Chase or Citi would do wonders in making the credit more flexible — and usable.
Longer-term, Amex should reconsider the entire concept of an airline fee credit and just make it what we all want it to be — a general travel credit.
There is no question Amex has made significant strides to make its premium travel-focused cards more appealing in the current environment. The limited-time perks are generous and may convince cardholders that were on the fence about paying hefty annual fees to keep their cards.
However, Amex’s reliance on built-in credits — including narrow ones like the airline-fee credit — has always been a weak point of the issuer’s most premium cards. Now is the perfect time for Amex to buck that trend, follow Chase and Citi’s lead, and widen the usage of its travel-related credit.
Kudos to Chase and Citi for smartly stifling any potential anxiety about whether or not you can use all your credits. Now, I’m just hoping Amex will do the same.
Featured photo by Zach Griff / The Points Guy.
For rates and fees of the Amex Platinum, click here.
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