What's Happening?
CommBank is set to significantly reduce its award program partners starting October 1, limiting options for customers who transfer points to airline and hotel loyalty programs. Currently, CommBank Awards points can be transferred to 12 airline and 3 hotel programs, but this will be reduced to only Virgin Australia Velocity, with Qantas available for an additional fee. This decision removes popular partners and travel redemptions, which experts say diminishes the value of the program by restricting customer choice. The move is speculated to be a cost-saving measure, possibly influenced by Velocity's desire to eliminate competition among CommBank's partners.
Why It's Important?
The reduction in CommBank's award program partners could have significant implications for customers who rely on flexible points programs for travel benefits. By limiting options to Velocity and Qantas, customers may face higher costs and reduced availability of reward seats. This change could also influence other banks to reconsider their partner options, potentially leading to a broader shift in the industry. Customers who value flexibility may need to explore alternatives, such as American Express Membership Rewards, which offers a wider network of partners.
What's Next?
Customers with active balances are advised to act quickly, as transfers to certain partners will close at the end of September. There is a possibility that other banks may follow CommBank's lead, reducing their partner options. However, experts believe that banks will likely retain popular programs like Krisflyer and Asia Miles due to their strong market presence in Australia. Customers may need to reassess their loyalty program preferences and consider direct earn options with Qantas or other banks.
