Banking Sector – Kiwibank introduces new credit card benefits as Airpoints partnership ends

• Kiwibank and Air New Zealand decide to end Airpoints partnership.
• Regulatory and economic impacts affecting the value and viability of the Kiwibank Airpoints credit card programme.
• Kiwibank launch enhanced Platinum Visa card with domestic and overseas travel insurance to better meet the needs of more customers.

Over the past decade, the regulatory and economic landscape has changed significantly. Increased costs and changes to interchange fee regulations have impacted the value and viability of the Kiwibank Airpoints credit card reward programme, with further regulatory changes expected.

Mark Stephen, Kiwibank’s Chief Customer Officer – Retail, says:

“Kiwibank prioritises investment that provides value to the greatest number of customers. After a thorough review, we concluded that these products are no longer the most effective way to achieve this.”

“The alternative to closing the products would be to reduce the rate at which points are earned or to pass on increased costs through higher interest rates – options we believe are neither fair nor in customers’ best interests, as it would mean that customers who do not repay their balance in full every month would further subsidise rewards for those who do.

“Based on customer feedback about what they would value in a new card, our enhanced Platinum Visa now offers a range of benefits that reflect this, including a lower interest rate and more interest-free days. For those who enjoy travelling, the card offers international travel insurance and new domestic travel insurance benefits[1].

“We also offer a Zero Visa card, with no annual fee and a competitive 12.90% p.a. interest rate, designed for Kiwi seeking cost-effective banking solutions,” says Mr. Stephen.

To support customers, Kiwibank is providing as much notice as possible. Customers can continue to earn Airpoints until 31 October, and for continuity, customers will move to a Platinum Visa card automatically.

Notes about interchange fees:

In 2022, the Commerce Commission introduced new pricing standards under the Retail Payment Systems Act to reduce interchange fees for transactions. While some of the increased costs were passed on to cardholders, a significant portion was covered by the card issuers.