Why Are Airline Mile Credit Cards From Banks Better?

Many people who have a airline mile credit card will tell you that having a credit card from a bank is a much better move than having one from a airline. Why is that? Isn’t it the airlines who are they to make sure you are getting on their planes. Don’t the airlines need passengers to stay in business?

Of course the airlines need passengers to stay in business. Without passengers they are nothing. So why does it benefit you to own a airline mile credit card from a bank instead of the airline directly? You have probably heard all of the changes going on inside of the airline industry. There are major layoffs happening on all of the major airlines. In 2008 two well known airlines, ATA and Aloha Airlines have gone bankrupt.

CNN reported that the major airlines are cutting capacity to save on costs. What this means is the days off having low cost fares are gone. The airlines cannot keep flying jets that are half full. Many smaller local routes are going to be the first ones to go. You can expect to see much fuller flights from this point on. It really is a good thing if you think about it. Airplanes burn so much jet fuel when in flight. With the cost of oil rising over the past couple of months (even though its lower right now) it is more than likely to go back up.

So why does this affect you and where you get your airline mile credit card? Let’s say you get a credit card from Northwest Airlines. You use the credit card for everything. You pump your gas, buy groceries, use it a restaurants, and pay your bills with it to earn your rewards. You accumulate a bunch of airline miles. Northwest Airlines has the right to tell you when and where you can use your air miles. The choice is not yours. Northwest has the ability to put you on unfavoarble flights just because they can. Northwest Airlines does not have to tell you this directly because its bad for business. If they did tell everybody, nobody would apply for the Northwest World Perks Visa Card. You have to think about it from Northwests point of view. Why would they want to give a free seat away to one of their air mile passengers when they can charge $500 for the same seat to somebody who does not have a NWA World Perks Credit Card? Northwest wants the $500 from the person paying full price. The seat is too valuable.

The airlines started instituting “black out dates.” United Airlines has a great example of what dates they use. During these days you cannot use your air miles. Isn’t it kind of funny how all of the black out dates fall around the holidays? Coincidence? I think not. The airlines know you want to travel on those days and people who want to travel to see family and friends or go on a vacation are willing to pay more. You, the air mile reward earner are going to have to pay full price like everybody else with what ever airline you have your credit card from.

What if you get a air mile credit card from a bank? How is this better? This is the best part of it. The banks are the ones that handle all of the transactions for the airlines anyways. Visa, Mastercard, American Express, etc., all have deals with the airlines. Of course the airlines want you to get their airline credit card because it forces you to fly with them. The airline will probably also earn interest on any balances you keep on your credit card.

When you get a air mile credit card from a bank you do not have the restrictions you would have by getting a credit card from a airline. How it works is that most banks will offer you the similar type of rewards the airlines do. You accumulate “air miles” or “points” for every time you use your credit card. You have a running balance which can be used at anytime. Let’s say you want to go and see your relatives who live in another state and you must fly. The air miles you have earned can be used now because you are not restricted to one airline. All you need to do is call up the bank who issued you the airline credit card and have them reserve a ticket for you. The bank will book your ticket with your credit card and credit the miles you have earned. This way it makes for a easy transaction. The best part is that there are no black out dates with bank credit cards. You have full control to pick what airline to redeem them with. Your bank does not care either way.

Take time when selecting the best airline mile credit card. There are a couple banks who have great air rewards programs. Discover is a top program who has great customer service and can help with any travel questions you have. Discover can also help you out with travel arrangements including car rental and hotel accomadations.