100K-Miles Deal Heats Up Affluent Rewards Marketplace

piggy bankAs far as anybody can tell, it will be the most lucrative credit card sign-up rewards deal ever.
Chase, the largest credit-card lender, and British Airways, are expected to offer new customers 100,000 airline miles in what will very likely ramp up the competition among card issuers for affluent customers.
The 100,000 airlines miles would cover a round-trip transatlantic flight. It will be rewarded to new card sign-ups who spend $2,000 on the co-branded British Airways Signature Visa cards within the first three months.
Customers who spend at least $30,000 in the first year will receive a matching travel voucher for a companion and card holders will earn 1.25 miles for each dollar spent. Cardholders will have to pay a $75 annual fee. The promotion is scheduled to start Nov. 6 for U.S. British Airways Executive Club members and Nov. 16 for nonmembers.
Anticipation is building for the new card, which has garnered widespread notices on blogs and news stories.
Other major card issuers, such as American Express, are turning to juicier rewards deals as a they attempt to tap into the revenue potential from affluent travelers and shoppers ahead of credit reform laws. Those new rules will likely lead to squeezed overall profit margins and higher operating costs, the card companies have said.
In August, Chase started targeting households with incomes exceeding $120,000 by offering Chase Sapphire, which has no pre-set spending limit and offers one point for every dollar spent.
American Express, which is dominant in the affluent customer marketplace, debuted its Premier Rewards Gold Card in October. It offers triple points on airfare purchases, double points on gasoline and groceries and one point for all other spending. The card also has 15,000 bonus points for purchases of $30,000 in a calendar year. The $175 annual fee is waived for the first year.
American Express is removing the 60,000-mile cap on its Delta SkyMiles Card, starting in February, which is when the credit reform laws are scheduled to take full effect. Amex offers up to 4 points for every dollar spent at 200 online retailers.
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