Making Financial Headlines · Page 6
American Raises Card Fees and Gives Loyalty a More Expensive Renewal
· New York time
American Airlines has raised annual fees on its rewards credit cards for the first time since 2018, joining other airlines and banks that have increased fees on major airline cards. The change makes the yearly cost of participating in the card programs more important to frequent flyers weighing their benefits. Rewards cards package the possibility of miles and other perks with a charge for holding the card. When the fee rises, customers have to compare the new cost with the benefits they actually use. A perk that looks impressive in an advertisement may be worth less to someone who rarely takes advantage of it. The increase does not mean every cardholder will be worse off, and the report does not establish that every competing card changed by the same amount. It does show that a familiar airline product has become more expensive to keep, even before a customer books a flight. Loyalty is a warm word for a relationship that arrives with an annual invoice. The airline gets a chance to emphasize the rewards, while customers get a fresh occasion to do subtraction. The program still promises to recognize its members; it has simply updated the price of being recognized. For travelers who enjoy collecting miles, the first journey may now be through the card's fee schedule.
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