Federal Legislation in Congress Threatens to Eliminate these Popular Programs
A new analysis by Airlines for America (A4A) has revealed that nearly 30 million U.S. airline credit card holders rely on their airline credit cards to accrue loyalty points. These loyalty points can be used for various benefits such as travel, flight upgrades, dining at local restaurants, and shopping for clothes and food. The analysis conducted by A4A shows that airline credit cards have a significant economic impact on tourism, particularly in Florida.
According to the analysis, over 2.4 million travelers visit Florida annually using their earned rewards, supporting over 31,234 jobs in the state and delivering a state-wide economic impact of over $3.75 billion. These rewards earned from airline credit cards also pay for approximately 15 million domestic visitor trips, supporting an economic impact of more than $23 billion.
The prevalence of airline co-branded credit cards is evident, with nearly one out of every four U.S. households owning one. These credit cards have become a powerful tool for consumers to earn points for future travel, with an estimated 63% of total frequent flyer miles/points earned in 2022 generated through the use of an airline credit card.
However, despite the popularity and economic benefits of these programs, some U.S. senators are advocating for legislation that would eliminate the benefits that airline credit cards bring to consumers and economies across the country. The Credit Card Competition Act, introduced by U.S. Senators Dick Durbin (D-IL) and Roger Marshall (R-KS), would eliminate consumer choice over which network credit transactions are routed. This would increase complexity and confusion while also increasing the cost associated with participating in these rewards programs.
If implemented, this legislation would not only threaten the existence of airline rewards points that enable millions of trips for Americans every year but also put all credit card rewards programs at risk. The Federal Reserve estimates that 84% of credit cardholders have a rewards card, emphasizing the widespread popularity and value of these programs to consumers.
A4A, as the industry trade group representing major U.S. carriers, is advocating for the protection of these programs through the launch of ProtectOurPoints.com. This website aims to raise awareness about the potential consequences of the Credit Card Competition Act and the negative impact it could have on consumers and the economy.
It is essential to recognize the significant economic activity and job creation generated by airline credit card rewards. They not only contribute to the growth of the airline industry but also support various sectors such as hospitality, dining, and retail. The elimination of these programs would have far-reaching consequences beyond just the airline industry.
A4A urges Congress to consider the tremendous benefits that airline credit card rewards programs provide to consumers and economies across the country. Protecting these programs is crucial for the continued growth and recovery of the tourism industry, particularly in states like Florida that heavily rely on visitor spending.
It is hoped that lawmakers will consider the negative implications of eliminating these popular programs and instead focus on policies that support and encourage the growth of the travel and tourism industry.