It’s about to become a lot harder to earn frequent flyer points through credit card spending.
asserted
It → become → spending
The Reserve Bank’s upcoming caps on credit card “interchange rates” are squeezing bank margins – which means less money available to fund credit card rewards and other prized cardholder perks.
asserted
which → squeeze → rewards
The banks have responded by dampening the generosity of credit card sign-up offers – reducing the incentive for customers to change banks to get a better deal.
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customers → respond → deal
Frequent flyer points awarded for ongoing spending are also being sliced: in some cases, by almost 50 per cent.
asserted
points → award → cent
Complimentary travel insurance has taken a beating; fees and interest rates have climbed, and the underlying conversion rates when transferring points from credit card programs to the airlines have also worsened, pushing discounted flights further out of reach.
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rates → take → reach
Under the reforms, many customers will be paying more for their credit card but getting less value and fewer rewards in return.
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customers → pay → return
On the flipside, businesses will no longer be able to surcharge customers to use their credit card from October 1, potentially bringing down fees in other ways.
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businesses → surcharge → ways
That is, if businesses don’t adjust baseline prices to compensate.
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businesses → adjust → prices
Some banks are making more impactful cuts than others.
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banks → make → others
Commonwealth Bank – Australia’s largest credit card issuer – is shutting down its current Awards scheme on September 29.
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Bank → shut → September
From October 1, it will be replaced by an expanded version of CommBank Yello.
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it → replace → Yello
It’ll offer points not only from credit card spend, but also through debit cards, home loans and insurance.
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It → offer → cards
This isn’t the end of flatbed flights using points, even for those who mainly earn their rewards on the ground.
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who → use → ground
What might seem a positive change is one that ultimately still reduces credit card frequent flyer points.
uncertain
that → seem → points
One of the deepest cuts sees international spend on the bank’s top-tier “Ultimate” credit card drop from an equivalent of 1.5 Velocity points per Australian dollar charged abroad to just 0.8 Velocity points per dollar spent overseas from October.
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spend → see → October
That’s occurring through both a reduction to the card’s direct points earning rate, and by devaluing the conversion rate that governs points transfers from CBA to Velocity.
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that → occur → Velocity
Rubbing salt in its customers’ wounds, CBA is also introducing a $99 annual charge to earn Velocity points.
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CBA → rub → points
Other big banks are making their own cuts.
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banks → make → cuts
NAB is updating its Qantas cards to combine lower baseline earning rates with tighter points tiering thresholds to reduce rewards.
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NAB → update → rewards
A customer spending $5000 per month on NAB’s Qantas Signature card will soon earn 2750 Qantas points each month – down from 5000 Qantas points at present.
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customer → spend → present
Westpac’s own Black-level Qantas card also takes a nosedive, but a more modest one.
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card → take → nosedive
On a $10,000 monthly spend, the prospective haul of Qantas points on standard purchases declines from 5000 today to 4000 come October.
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haul → decline → 4000
Virgin Money is similarly serving up fewer points while increasing cardholder fees.
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Money → serve → fees
HSBC is making a complete exit from the Australian consumer banking market in November, closing all personal credit cards in the process.
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HSBC → make → process
ANZ is bucking the industry’s doomsday trend as one of the only card issuers continuing to provide one full airline frequent flyer point per dollar spent via its top-shelf cards.
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ANZ → buck → cards
However, that’s countered through reduced insurance coverage on some credit cards and a full removal of that insurance from others.
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that → counter → others
New monthly points caps will also apply, versus limitless points earning at present.
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caps → apply → present
American Express – which sits outside of the RBA’s interchange fee caps – hasn’t announced any further cuts.
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which → sit → cuts
However, Amex devalued its Membership Rewards program in late 2025 to require 50 per cent more credit card points for equivalent flight rewards through its international airline partners.
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Amex → devalue → partners
For instance, to receive 100,000 frequent flyer points with the likes of Cathay Pacific Asia Miles or Qatar Airways Privilege Club, Amex cardholders could previously convert 200,000 Membership Rewards points (2:1 conversion).
uncertain
cardholders → receive → points
Now, the same reward requires 300,000 Amex points (3:1 rate).
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reward → require → points
But with the downfall of credit card points comes new opportunities.
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opportunities → come → points
From December 8, Qantas will begin offering status credits on the ground to keep travellers hooked on points-earning plastic.
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Qantas → begin → plastic
Through a combination of credit card spend, as well as grocery buying, insurance purchases, utility payments, hotel bookings, share trading and other eligible transactions, Qantas Frequent Flyer members could earn up to 140 status credits each year without taking a single flight.
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members → earn → flight
That’s almost halfway to annual Silver status.
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That → ’ → status
Separately, bank incentives for new credit card applications may be taking a back seat, but aren’t expected to disappear entirely.
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incentives → take → seat
While hopping to a new credit card may no longer deliver enough points for a long-haul jaunt in business class, the points incentive for doing so could still get you flying to that same destination in premium economy or economy.
uncertain
you → hop → economy
Alternatively, a credit card points bonus could cover a more comfortable journey closer to home.
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bonus → cover → home
This isn’t the end of flatbed flights using points, even for those who mainly earn their rewards on the ground.
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who → use → ground
Knowledge is power – and in this case, your ticket to flying on points during the years ahead.
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Knowledge → fly → years
The Aporia
