{"id":7204,"date":"2024-05-10T13:29:20","date_gmt":"2024-05-10T11:29:20","guid":{"rendered":"https:\/\/oxfordwisefinance.com\/blog\/airline-rewards-programs-under-scrutiny-by-the-biden-admin\/"},"modified":"2024-11-25T23:14:09","modified_gmt":"2024-11-25T22:14:09","slug":"airline-rewards-programs-under-scrutiny-by-the-biden-admin","status":"publish","type":"post","link":"https:\/\/oxfordwisefinance.com\/blog\/airline-rewards-programs-under-scrutiny-by-the-biden-admin\/","title":{"rendered":"Airline Rewards Programs Under Scrutiny by the Biden Admin"},"content":{"rendered":"\n
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White House officials and regulators are probing what they say are issues with airline credit card programs, including the devaluation of points, high interest rates and the stripping of travel benefits.<\/p>\n

Americans tend to have a love-hate relationship with airline credit card programs: Putting day-to-day spending on these cards can feel like an easy way to earn quote-unquote \u201cfree\u201d trips \u2014 and the perks can make air travel a more luxurious experience \u2014 but officials say they\u2019ve heard a laundry list of consumer complaints about how these programs are structured and operated.<\/p>\n

Credit card and airline reward programs have ballooned in popularity in the last few years amid the post-pandemic rebound in travel: According to one estimate, roughly 30 million Americans have airline credit cards that generate $23 billion a year. Secretary of Transportation Pete Buttigieg tells Money that for some big airlines, the profitability of these programs now \u201crivals or exceeds that of actually flying planes.\u201d<\/p>\n

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Consumers increasingly think of their rewards balances as part of their savings, he says, but what those points are actually worth \u2014 both now and in the future \u2014 is unclear.<\/p>\n

\u201cA lot of us build up our savings in our points accounts just like we do in our cash accounts. But unlike a bank account, your points or miles have a value that could be changed overnight by a company,\u201d Buttigieg says.<\/p>\n

Travel experts discourage fliers from stockpiling large amounts of rewards for exactly this reason: You can get burned if your airline of choice quietly decreases redemption values and you suddenly find that you can no longer afford the trip you\u2019ve been planning on taking.<\/p>\n

Airline rewards programs under scrutiny<\/h2>\n

The Department of Transportation (DOT) and the Consumer Financial Protection Bureau (CFPB) have been researching these issues for months, and they shared some of their findings in a hearing Thursday alongside airline executives, consumer advocates and other stakeholders.<\/p>\n

Rohit Chopra, director of the CFPB, said that among their concerns are:<\/p>\n