Points Pinch: Credit Card Rewards in Turmoil

0:00Australians love their frequent flyer points like a second currency. Quantas has 18 million members racking up over 200 billion points yearly while Virgin counts 12 million. These schemes that you are miles from credit cards, groceries, even switching utilities. But the reserve bank just drop reforms that could crimp the flow. Starting October, interchange fees, those charges merchants pay banks on card swipes, get slashed. Costing banks $660 million a year. Banks use that cash to fund juicy rewards like Quantas points, so expect less generous credit card perks to offset the hit. Consumers might feel the pinch through higher fees, shorter interest-free periods, or fewer points per spend. The RBA wants this to stop shops passing surcharges to us and end merchants bankrolling cardholder freebies. Banks are the top buyers of airline points, so ripple effects hit loyalty programs hard. Airlines like Quantas say they're unfazed, holding profit guidance because folks crave

1:00those miles no matter what. Analysts call it consumer elasticity. Will we ditch cards if rewards shrink? Banks might hesitate to cut deep, fearing customer exodus. This shake-up tests if our points addiction outpowers bank bottom minds. Keep swiping smart and watch how the skies stay loyal. Local news, powered by AI. This is Sydney News Today. I'm Corey with The Story.