A member new to the world of frequent flyer points is pondering credit cards and point maximisation. They have a significant amount of expenses that they can put on their credit card each year, but face a surcharge from their supplier for doing so. Is the surcharge worth the frequent flyer points?

I am in a position where I can potentially put $500k a year on the credit card every year as I have my own business. My supplier has a 1% credit card surcharge on Visa/Mastercard, but I’m thinking that the cost may be worth it if I can get the points?

…Is the 1% surcharge on the credit card transaction ($5000) worth the 625k of Diners Club points? My main purpose for the points is to convert it to frequent flyer points and use it for full priced economy international flights (as I have no status on any airlines). Main reason I’m leaning towards Diners is so that I can convert it to numerous airlines, instead of being locked into Qantas or Virgin.

Most of our members agree that YES, it is generally worth paying the credit card surcharge if points are on offer. This is especially the case if the credit card fees are a business expense and therefore a tax write-off. However it ultimately comes down to how the points are to be spent. In the Diner’s Club example, it is noted that 625,000 Diners points can be converted to Qantas points and used to book a return business class trip from Perth to Los Angeles via Hong Kong on Cathay Pacific (with points leftover). In this example, the cost of the points and tax co-payment is lower than the price of an airfare, meaning that gaining the points is worthwhile.

But if the points are used to travel in economy, or no reward seat can be found at all, it may be a fruitless exercise.

a family member has a small business and accrue a lot of points… but the problem is they can never use them, or the awards they can redeem are extremely bad value.

…if you spend $5000 to get a ‘$7000’ airfare, but can’t get availability for the dates you want, on the route you want… what’s the point?

Flight redemptions in premium cabins are often exceptional value, though they are very much subject to availability. Sometimes it can be very difficult to find award seats on the most popular routes and this becomes even more of a challenge if an entire family wants to fly.

Our members offer some advice on choosing the best credit card, and which frequent flyer program to credit to. Some suggest that although Diners Club offers good value, there are better options out there. The Citibank Signature card is suggested as it transfers to a range of frequent flyer programs including Virgin Australia Velocity, Emirates Skywards and Singapore Airlines. It is also currently possible to pick up the card fee-free for life!

I’d easily recommend getting a Citibank Signature card.

You earn 1.5 citibank points per $1.00. You can then transfer those Citibank points at 1.5 to 1.0 to Singapore Airlines Kris Flyer, so spending $500K in Australia, gets you 500,000 KF flyer points.

For example, 450,500 KF will get you get two seats First Class from Melbourne to Paris return

Perhaps you find yourself in a similar situation. Would you pay the credit card surcharge just to get the points? Have your say HERE.


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Matt Graham
The editor of Australian Frequent Flyer, Matt's passion for travel has taken him to over 60 countries… with the help of frequent flyer points, of course!
Matt's favourite destinations (so far) are Germany, Brazil, New Zealand & Kazakhstan. His interests include economics, aviation & foreign languages, and he has a soft spot for good food and red wine.

You can contact Matt at [email protected]