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Qantas Cash card may well challenge the banks

Qantas may have handed consumers a way to beat some bank charges or reconsider how they currently use bank issued credit cards with its new chip enabled frequent flyer cards

The unveiling of a chip-enabled Qantas frequent flyer card this morning will be massive news in banking as well as loyal program circles, notwithstanding some soothing words from Qantas that the new FFP card is not  intended to replace bank credit cards or co-branded bank/Qantas cards.

The Qantas Cash feature in the card means that it can be used through advance depositing of funds just like a debit card for everyday purchases that will earn Qantas points at the bowser, at the grocers, in fact anywhere it is accepted for a payment here and abroad, as well as a cash withdrawal card in Australian and foreign currencies.

Consider the Qantas FAQ concerning the card, and then ask, to what extent could this replace the functions of my existing bank issued cards, for which in some cases, the banks charge a substantial annual fee?

As product disclosure statements always stipulate, consumers should carefully consider their position and take independent advice and so forth.

But when they do, there is little room to doubt that Qantas will have a competing offer for some retail banking ‘extra’ services, keeping in mind you will need to preset or precharge the Qantas Cash reserve from your bank account.

Given the poor standing of banks in relation to fees, it is possible that Qantas could score some major kudos for this initiative.

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  • 1
    TT
    Posted February 20, 2013 at 11:38 am | Permalink

    It’s a very interesting (and probably smart) move by Qantas – they have recruited quite a fair few new QFF customers from the Woolies rewards scheme, and now they would use that to offer “new” services to them.

    The concept of prepaid MasterCard service would be directly aimed at Travelex’s cash passport, American Express and the big banks on the travellers cheque and the equivalent products. It sounds like Qantas’ relationship with American Express will deteriorate further as a result. (AMEX already moved quite a lot of members benefits program on air travel from Qantas to Virgin in the last few years). The only thing I would question is: would this prepaid Mastercard business a significant contribution to QFF’s bottom line? I hope they won’t ended up what happen to David Jones when they signed up with American Express…

  • 2
    Dan
    Posted February 20, 2013 at 12:27 pm | Permalink

    Being Qantas, I wouldn’t be surprised if it’s primarily a fee extraction mechanism for members who don’t pay full attention, like the equivalent Air New Zealand card is:

    http://www.airnewzealand.co.nz/onesmart#get-the-most-out-of-onesmart

  • 3
    Andrew Burry
    Posted February 20, 2013 at 12:39 pm | Permalink

    Isn’t this pretty much the same as the OneSmart Air New Zealand Airpoints card introduced a couple of years ago … with maybe a few less features? Obviously Qantas can further develop this. With currency options, it will directly compete with Amex, Travelex etc.

    “The new Airpoints™ Card, SMART anyway you look at it.

    We’ve recently introduced a new Airpoints card packed full of benefits for eligible members.

    Your new Airpoints card just got smarter as it comes with OneSmart features. It’s a reloadable payment card and Airpoints card in one, and packed full of benefits that make travelling easier. It will transform the way you earn and use Airpoints Dollars.

    Heading overseas? Your OneSmart Account is an easy way to take money when you travel. You can buy up to four foreign currencies (choose from eight) online at great rates before you takeoff and pay us no commission1. When you’re using overseas ATMs you won’t pay us any fees to withdraw funds2, not forgetting you’ll also earn Airpoints Dollars on eligible purchases3 when using your Prepaid Debit MasterCard.”

  • 4
    Posted February 20, 2013 at 12:40 pm | Permalink

    Sounds a lot like Air New Zealand’s OneSmart.

  • 5
    Posted February 20, 2013 at 1:23 pm | Permalink

    I was a member of a focus group about 6-9 months ago for Qantas developing this card. It seemed pretty clear there that the main focus was overseas travel.

    (at the time, they seemed completely neutral on whether to make the card Mastercard or Amex, showing mockups and feature lists for both: the overwhelming view in the focus group was to go with Mastercard because of Amex surcharges and poor availability)

  • 6
    patrick kilby
    Posted February 20, 2013 at 1:56 pm | Permalink

    Not clear what the fees are to withdraw funds which is the big issue “When you’re using overseas ATMs you won’t pay US any fees to withdraw funds”. Of course you pay fees to the machine but how much. On my bank debt card the average set of fees is fixed at around $10. Which means withdrawing at least $200 at a time. Will this be any cheaper.

  • 7
    Jon Carr
    Posted February 20, 2013 at 2:02 pm | Permalink

    Will it be a challenger to the GE 28 Degrees card. I’ve used this a lot over the last 18 months and it has been great.

  • 8
    Keith Williams
    Posted February 20, 2013 at 2:18 pm | Permalink

    The biggest question and the most obvious one. When I pay for a Qantas ticket on-line are they still going to charge the card fee whatever the exorbitant amount it is now?

  • 9
    Geoff
    Posted February 20, 2013 at 8:11 pm | Permalink

    It sounds like the Commbank travel money card I use. Fill it up from your account, recharge it as required, no cost if used as a credit card (but it’s not it’s Debit card) charges if you use an overseas ATM.

    No points, they only accrue to credit cards

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