Star Alliance Launches Credit Card In Australia

Maybe, just maybe, a global airline alliance has figured out that 96% of the world’s population isn’t American, and is making something credit-card-related for them?

If this allows miles and more transfers then I’m in, but I doubt it.

I can only imagine how many times in the T&C we will see:
*Does not apply to SQ
**Does not apply to SQ
***Does not apply to SQ
...
...
...

I could include Lounge Access

Wouldn't it just make more sense to synchronize mileage earning all Star Alliance partners and then require partners to have the same award space open to partners as to its own members. LH is notorious for offering saver fares to it's members months in advance then (even with a half full cabin) opening space a few days prior to departure.

Very unlikely. Rest of the world will still get mediocre benefit cards while still paying the same amount of fees as the american version, i.e. Amex, whose Platinum benefits are ridiculous cut down around the world when compared to US, but still charging the same fees, if not more in some markets

A alliance transferable points system would be very cool but earning 1x or gasp. .5x is crap.

u are being naive, the banks/airlines won't allow something that will cannibalize the exisiting products. More likely we see something like Redeem your 20k *A points for a $250 towards a ticket on any Star Airline.
Likely one of the smaller players like Synchorny or Cardless

I mean, this sounds good, but in reality doesn't add much value. The whole point of alliances is this "transfer to a *A partner" isn't necessary. If you move miles to LifeMiles or AC, you can redeem on most anything.

The only reason this would matter is if LH or SQ first redemptions are on your 'to do' list, but even then there are solutions now from cards or the banks.

Wasn't it also *A that promised an airline agnostic (or all-inclusive) awards booking tool? What ever happened to that vaporware.

Don't knock it before you try it..Yes there are Americans that see no further than their own border. Lots of them unfortunately. This from an American himself.

This could potentially be cool for people residing in a country without Star Alliance base - I live 40 minutes drive from LH Group hub but can't get airline credit card because it's across a line on the map. I understand how it may be inefficient for individual airlines to deal with these smaller markets and doing it on alliance-level could solve this issue. Ideally, SA could partner with one of the pan-European banks (e.g. N26) to cover the entire European market rather than individual member states only.

Booking partner airlines is already complicated. Making transferrable points is just adding another layer of complication. Not to mention having disparity between miles from different airlines.

If this card were to materialize, I would imagine a fixed point redemption would be the answer. So it could either be 10k points gets you 1-750 miles or 10k points is $100 off any ticket. Either way must be booked through some broken booking platform.

And we still haven't discuss card benefits. Giving Star Alliance Silver benefits probably wouldn't attract anyone at all. Giving perks that would be similar to Star Alliance Gold would cannibalize the incentive to earn over just paying for it. That wouldn't make member airlines happy.

This.

The rest of the world has limits on credit card transaction fees making them far less lucrative than in the US where they’re free to charge a lot more.

I wish airline alliances were more like hotel programs where I have more choices how I spend my miles and consistent program across all the carriers.

This is a good idea for markets outside of the US credit card ecosystem. We have lots of choices between products & methods to rack up points. Not the case elsewhere.

"The whole point of alliances is this "transfer to a *A partner" isn't necessary."

That's a statement by someone who clearly hasn't had the face the difference in what "should be" versus what '"is," in terms of redemption.

Case in point: try to get a roundtrip Business redemption on LAX/EWR-SIN using UA miles, on anything even approaching a realistic inbound/outbound schedule.... let us know how easily that happens.

Sounds like a good idea for markets like the UK, where no single Star Alliance carrier has a strong presence but collectively they do.

They certainly would not undercut existing credit cards issued by member carriers - unless their end goal is to kick the carrier out of the alliance passive aggressively.

If United would not be a part of it, it would benefit everyone. But with an US company and bank involved, they would abouse all others in the world, except there own.
Star alliance without United, that would be so great.

You are suggesting kicking United, a founding member, out of Star Alliance?

Would be great for LH if you could earn more than 1 mile per $ like the LH card since no other currency can transfer to them.

As Star Alliance is led by Lufthansa, perhaps the first market will be Germany (and maybe also Belgium, Austria and Switzerland).
But on the other side, Lufthansa already has own credit cards at all those markets.

It will be interesting to see how this works as a proof of concept. As Ben noted, interchange fees in Australia mean that credit cards can't be as lucrative as they are in the US, typically you earn one point per dollar spent (AUD) on airline specific cards and less on transferable card currencies. I'll be interested to test the value proposition against Amex MR for SQ, and *A Gold with SQ in the first year is a positive.

In the absence of spend, does the $450 annual fee provide lounge access? If not, what's the point?
Regarding spend, what a ROTTEN card. 1X on the first $3k of spend every month and 0.5X thereafter, then transfer to Krys Miles at 0.8X? If one wants to maintain Star Alliance Gold, it's $60k per year. So, $36k at 1X and $24k at 0.5X equals 48k Star Points, which equals 38,400 Krys Miles. A$60k = US$39,200. So, the card earns roughly 1X Krys Miles per US$. Punt.

PS - Often non-US-issued cards have foreign transaction fees. May want to check on that.

Whilst it’s nice to see this launch in Australia, it’s not like we don’t already have flex currency cards in the Australian market who offer a handful of *A partner transfers. It adds a big more choice but for most consumers, they won’t find value in being able to lob points to Lifemiles or Miles&More as their respective airlines don’t fly to Australia.

The mechanics of this card requiring you to set a transfer partner each month sounds extremely fustrating especially if the consumer is looking to maximise redemption value (which is a considerable value proposition over a co-brand credit card… of which the Australian market is 80%+ Qantas co-brands). If they changed this to a points bank that you could draw down on when you want to (like every other flex currency in the market), I’d suspect more folks would consider getting onboard with the card.

The other thing is that whilst Australia tends to have crappy interchange fees, the sign up bonuses aren’t too bad. This cards perks really don’t stand up enough to a solid sign on bonus which will heavily sway consumer preference to existing cards on the market.

'The other thing is that whilst Australia tends to have crappy interchange fees, the sign up bonuses aren’t too bad.'

Whether the interchange fees are crappy or not depends on your perspective. Yes they are crappy for credit card companies and the people (like points collectors) who benefit from what they can give back to us, but for other users and the businesses that accept card payments they are good, and that's who the banking regulators were thinking of when they set the rules on interchange fees. They are priced as an essential service not as a luxury, and I'm happy with that even though it limits how many points I can earn. And yes, sign-up bonuses are good here if you're prepared to go through the churn of changing or adding to your portfolio of cards. If you fly much, SQ gold status (which gets you VA lounge access) isn't too bad a sign-up bonus.

Rereading the T&Cs, 0.8 Kris miles per AUD isn't much good when compared to 1 for Amex MR and 1 QF mile that's commonly available for their co-branded cards (some of which pay an extra mile for spending with QF, and some with higher returns on foreign spending). I remain to be convinced it's a good deal for me.

Nice that you can send the point s to any *A airline, ANA would be my choice, shame you can’t also nominate the airline you get status with. This isn’t worth a $450 annual fee and there’s no signup bonus.

However I guess it has to be a $450 card because SQ gold gives you lounge access on virgin Australia domestically. I guess I would consider it if I was a virgin flyer domestically and wouldn’t hit virgin gold through flying.

Depends what you want status to do for you. If you want lounge access and priority check-in etc, any *A would do. If you want the status bonuses for revenue trips on your preferred *A carrier being able to choose is important. For VA, SQ status is fine, and you can link your VA and SQ FF accounts and gain some advantage from that. If you're with VA, any *A gold status fills some gaps in international benefits when flying UA and AC, and gives you benefits with Air New Zealand across the ditch.

All these things only matter if you've decided the card is worthwhile, and they're only relevant for the first year. I can't imagine anyone meeting the spending requirements for later year status and not earning elite status from flying.

I'm sure the sign up bonuses will come once Amex Au ups their sign up bonuses.

SQ Gold status might be quite handy when wait listing for saver awards.

Maybe they will announce some transfer bonuses. Agreed though, you would spend more time trying to maximise the earn and transfers than your time may be worth, due to the many ifs and buts in the deal.

Are those 7 participating airlines the only Star Alliance flying to Australia? If so, it'd explain it, and leave room for growth. This is basically a trial with no local airline to annoy.

After COVID, business travel certainly decreased....

I'm already SQ gold (and Australian). I can't see any benefit to me.

Regarding the low earn rate for Australians - for context HSBC's Platinum Qantas card only allows you to earn 1 Qantas Point for every $1 of eligible spend, up to $1,000 per statement period and then 0.5 Qantas Point for every $1 of eligible spend thereafter per statement period.

The earn rate for the Star Alliance card is not so bad in comparison.

Correct, and useful context for US readers aghast at the low earn rate. Points Guy had an article today wishing for a similar product in the US, and noting that such a card would likely have a comparable earn to other US cards.

One QF or VA mile per AUD spend on co-branded cards is as much as you can expect (sometimes 1.5 for foreign spend and 2 on spend with the issuing airline) and rarely for uncapped monthly spend. Domestic airline cards at the same annual fee price point have typically better earn rates than the *A card (and often sign-up bonuses). The HSBC QF card has a lower annual fee.

Amex has co-branded cards here with similar fees and earn rates as the Visa/MC ones. They also have MR earning cards with points that can be transferred to SQ and TG (among others but not the long list available to US members) at one mile per AUD spend (and very few bonus earns). Apart from that the best Visa/MC I've seen where points can be transferred to SQ offered 0.5 miles per AUD.

So, this card is not the best deal available if you want *A miles but its returns aren't risible given the competition.