Qantas, Virgin loyalty programs under threat from RBA

Qantas and Virgin’s frequent brochure schemes are among the most profitable arms of both airlines, but now they sit upright in the landscapes of the Reserve Bank.

In FY25, Qantas loyalty 2,845 billion dollars income and $ 556 million earned before tax, almost 12% of the airline turnover and equal to one -fifth of its profit. Virgin’s speedA smaller but more fat margin has 450 million dollars in revenue and interest and taxes (EBIT) earlier $ 127 million earnings, approximately 20% of the general gains of the group.

These high-margin sections are built on the willingness of purchasing points for banks’ common branded credit cards-and this flow depends on the exchange fees. On September 22, 2025, the House of Representatives Michele Bullock, Governor of Reserve Bank, who appeared before the Permanent Committee of Economics Ban Additional Fees And the bottom junction covers The result of the probe that lasts from 0.8% to 0.5% or 40% – one year.

“Another critical field of work for RBA is the regulation and supervision of the payment system.” he said. “We are reviewing the costs of the situation and the seller card payment costs, ve and promised to reach the policy settings that best encourage competition, efficiency and security.

Loyalty under pressure

The membership scale shows how danger it is: Qantas frequent brochure has grown approximately 16 million membersWhile counting speed about 13 million Members as of June 2025. The neck emphasizes why both programs are at the center of airline profitability and why RBA’s reforms are important. In the face of record losses in 2014, Qantas thought of selling his loyalty arm, but retreatedAt that time, the Joyce, which takes CEO, shows the strategic value of the program.

Still, Qantas loyalty has missed 10-12% earnings every year by 2030 9% Growth in FY25 – And although the loyalty CEO Andrew view is optimistic about healing it, the results of the August were investigated by suspected analysts in the briefing. RBA’nın proposed change cuts will be “a challenge for banks”, “until 2030 in terms of the targets we put in terms of trust ourselves and we will go on our way,” he added.

AWARENESS AWARE OF RBA’s intention last year has recently launched program changes. On August 5, 2025, Qantas increased local award prices by approximately 15% – Sydney -Melbourne Economy Award rose 8,000 to 9,200 points Some long -distance rewards such as one -way seat from Sydney to La have increased more than 20% 108,600 to 130.100 points. Business Class Awards for London 144,600 to 166,300 pointsIn addition to higher carrier fees. At the same time Qantas quietly upgraded pricing Classic plus seats – without telling your members.

For speed, firefighters reflect the movements of Qantas. At the beginning of 2025, the program increased the required points for many international common routes, increased the domestic upgrade thresholds to at least 10,000 speed points and reduced the value of the “Point + Payment” option. At the same time, he has added the status levels and changed the members from the credit card expenditures while pushing their members towards the “ground” thrust. Myer partnership (Announced by myer chief and former Qantas loyalty boss, Olivia wirth lost in the best job Two years ago in Roo flying to Vanessa Hudson).

Exporters also move in the foreground. Westpac It reduced earnings rates and brought monthly limits between Qantas and speed products. NAB has stopped giving points for government payments since October. American Express Now, after the members hit 100,000 points a year, they gain gases in Qantas joint brands. . Nations Society Bank He applied $ 10,000 on smart and final award cards, and as of October 1, the flight center and the award has removed ESHOP recovery. It would not be surprising if there was no more changes if it was delivered in the RBA plan.

. Australian Banking Association He warned that cutting exchange fees will simply lead to “higher card fees, interest -free periods and reduced prizes .. Anz, saying that the existing settings are suitable Cba He supported the prohibition of additional wages, but he drew attention to deeper interruptions. Bullock rejected threats from banks to withdraw fraud protection or intestinal prizes “Hitting themselves in your feet”.

What does it mean to card holders?

Consumer sting is combined with behavioral effects. Australian Competition and Consumer Commission’s August Airline Monitoring report They affected 71% of loyalty programs, and when members were close to reaching a status threshold, they usually paid about 8% more for wages. This “loyalty premium” shows how passengers may not notice the real cost of chasing prizes.

Points forums reflect disappointment. In the Australian Frequent Brochure Forum, a user published: “You can spend more, but you may feel less winning – these rules continue to change to you.” In R/Ausfinance, others complain that the programs have become “shadow of their old self” and “you need more spending and more points than ever to stop still”.

Qantas coming from inside Crirase The active loyalty base sees with the smoke and mirrors of young customers’ loyalty plans and preferred to get the benefits of cheaper flight tickets elsewhere.

Both airlines draw their programs beyond their credit cards: Qantas expanded Retail Earning Partnerships And recently pushed Qantas Business Awards The platform for SMEs doubled daily spending connections with Velocity Coles and 7-Eleven. Both invest in wider financial services and salvation without air lines such as shopping and gift cards. In addition, they try alternatives to credit cards, such as prepaid cards that can still make spending balances every day, a fence against the risk that credit cards financed by my change are no longer loyalty motor room. Qantas Insiders said that the loyalty department was disappointed with the performance of the shopping model and that he hired AI experts to help improve the targeted marketing to resist the stroke from change cuts.

History argues that Australia can soon reflect Europe. . EU’s Change Fee Regulation (2015/751) Capped debt card intersection fees 0.20% and credit with 0.30%, the European Commission estimates that changes will reduce secret card fees about € 6 billion per year. Academic research has shown since then The exporters responded by reducing prizes throughout England and the EU and reducing earnings. The pattern is that when the change is closed, consumers get less points and their scores are less purchased. This is the future that Qantas and the virgin are afraid now.