American’s Great New Credit Card Agreement With Citi AND Barclays!

The merger between American and US Airways hasn’t just been interesting from an operational perspective, but also from a partnership perspective. For example, American was part of oneworld, while US Airways was part of Star Alliance, so the combined airline ended up joining oneworld.

On the credit card front, American’s credit cards have long been issued by Citi, while US Airways’ credit cards were issued by Barclays. It’s interesting to see how this is playing out.

The current state of American’s credit card agreement

As it currently stands, American continues to issue Citi AAdvantage credit cards. While Barclays is no longer allowed to issue AAdvantage credit cards, those who already have a Barclays AAdvantage card can continue to use it.

We were told we would eventually learn about American’s new credit card agreement as they finalized it, and it looks like that has finally happened. Going forward, American will be working with both Barclays and Citi on co-branded credit cards.

American’s new agreement with Citi and Barclays

This is an interesting agreement, as it makes American the first US airline I know of to have credit cards from two issuers. This is similar to Hilton on the hotel front, as Hilton has a partnership with both American Express and Citi.

What’s most fascinating is how Barclays and Citi will be marketed differently, per American’s press release:

American has entered into new agreements with both Citi and Barclays US. The agreements will allow Citi to continue offering its lineup of cards to new customers through multiple exclusive channels such as digital – including aa.com – mobile, direct mail, and Admirals Club lounges.

The agreements will also allow Barclays US, the payments business of Barclays in the United States, to offer its cards to new customers in airports and exclusively during flights beginning in January 2017.

Current cardholders will continue to see the same great benefits from both Citi and Barclays US as well as benefit from a new, long-term exclusive agreement with Mastercard.

So Citi cards will be advertised on American’s website, through the mail, and in Admirals Clubs, while Barclays will be advertised in airports and on flights.

It hasn’t yet been announced exactly when Barclays will once again be able to issue AAdvantage credit cards, but we’ve now started to see a couple options, like the AAdvantage Aviator Red World Elite Mastercard.

What does this mean for consumers?

This is great news for consumers. Competition is always a good thing, and that’s exactly what we’re seeing here. We should see more competitive benefits, better sign-up bonuses, and better return on spend thanks to the competition between the two issuers.

I think many of us are still curious what this means in regards to an elite qualifying dollar waiver for American status.

American is introducing a revenue requirement for status as of next year, but hasn’t yet announced if there will be a way to get that waived by spending a certain amount on one of their co-branded credit cards. Hopefully we find out soon, as I’ll be curious to see if American has an exclusive agreement with one of those issuers in that regard.

While I don’t yet know the details, I suspect they will offer something in the way of a waiver. Both Delta and United offer a waiver when spending $25,000 on their co-branded cards. The major difference is that with Delta the waiver even applies for top tier status, while it doesn’t with United.

Similarly, I’m curious if Barclays has the right to introduce a premium credit card intended to compete with the Citi® / AAdvantage® Executive World Elite Mastercard® , which comes with lounge access. While Barclays has a few types of AAdvantage credit cards, there aren’t any truly premium ones yet.

Bottom line

The way I see it, this is the best case scenario, as we’ll see increased competition in the credit card market for American’s customers. With all the mergers between airlines, we’ve also seen reduced credit card offerings from airlines. This should nicely counteract that, at least for American flyers.

Now I’m just curious to see what this means for the portfolio of cards offered, and which issuer will have a right to offer an elite qualifying dollar waiver, if any.

What do you make of American issuing cards from both Barclays and Citi?