Understanding the Australian Credit Card Market

Some people are a bit perplexed for the need to discuss credit cards as they exist in the market of a particular country. After all, since all credit card companies tend to operate on an international basis, what is the need to think of credit cards in terms of countries? While it is certainly true that the most successful credit card companies (i.e. MBNA) have operations in many different countries, it is just as true that these operations are quite different. Frequent flyer partnerships as well as local partnerships with companies are different in different countries and that is why discussing credit cards with respect to the specificity of Australia’s market is a necessary thing to do.

Current Trends

In terms of their current trends, Australia’s credit card market is actually quite similar to the markets in most of the developed world. The current trend is going away from conventional credit cards deals to deals that are more exotic in nature. People are increasingly willing to accept higher fees and interest rates in exchange for better reward programs, while the companies that operate in the market are willing to give customers with good credit the competitive rates and fees as well as the good reward programs. This trend seems to be everywhere in the developed world and Australia is no exception.

Frequent Flyer Miles

Frequent flyer miles are by and away the most popular reward program available in Australia. This is intuitively knowable through understanding that Australia as far as developed nations go is probably the single most isolated nation from the rest of the world. The isolation of a nation like Australia means that people that travel from the country need to take expensive flights to do so and that in turn means that frequent flyer miles and the potential for free vacations that they bring to the business are welcomed by many within the Australian population.

At the current moment in time, every major and several minor carriers have frequent flyer programs with different airlines. The two most popular however are Qantas and Virgin Blue. These are of course two of the major international carriers that operate solely within the Australian market, although people that travel back and forth between Australia and one other country can also get frequent flyer miles on other airlines if they get a better deal. A good example of this would be someone traveling regularly between Sydney and Vancouver (a city in Canada) and using Air Canada frequent flyer miles in order to get that done. Such a thing is possible in the Australian credit card market.

Other Reward Programs

There are of course many other reward programs available to people that live in Australia, but the most popular ones after the frequent flyer miles are invariably others that deal with travel as well. These include things like reward miles on hotels and restaurants, although reward programs that have to do with free or discounted gas are also starting to become very popular as the price of gas begins to increase at a very quick rate. While all of these programs are indeed popular, the vast majority of them still hold a very distant secondary position to the out and out popularity of the frequent flyer programs within the Australian credit card market.

Affinity Programs

Affinity programs are not as popular in Australia as they are in the United States and United Kingdom. They are not even as popular as they are in Canada, where affinity credit cards hold a somewhat less popular view than in the big two of credit card countries. Affinity programs are available in Australia however, since international credit card chains do not need much to keep a specific credit card affinity program on their books. This means that if you have a specific charity or franchise that you would like to help out through credit card purchases, chances are reasonably good that you will be able to find an affinity credit card for it.

The Australian credit card market functions in ways that are very similar to other developed nations, although the out and out popularity of flight-based reward programs is something that is somewhat unique to Australia, where travel of any kind usually requires flight.