Airlines are in panic mode, and it’s not because of flight delays. A new bill targeting swipe fees from Visa and Mastercard has major carriers like American Airlines, United, and Southwest warning that your favorite airlines credit card perks could disappear for good.
In a joint letter to lawmakers, airlines, aircraft manufacturers like Boeing and Airbus, aerospace firms like RTX and GE, and even aviation unions came together to slam the proposed legislation. Their biggest concern? The bill could gut the financial backbone of airline rewards programs, those miles you rack up with every swipe of your branded travel card.
Why Airlines Are Freaking Out
The bill, backed by Senators Dick Durbin (D-IL) and Roger Marshall (R-KS), aims to cut the transaction fees that businesses pay every time you use a credit card. These “swipe fees” are how Visa and Mastercard earn their keep, and they’re a huge part of how airlines fund rewards programs.
Airlines argue that if these fees are capped or rerouted, they’ll have no choice but to scale back or kill off their rewards credit cards, which generate billions in revenue.
Senator Durbin has previously accused airlines of acting like “credit card companies that own some planes”, a jab at just how dependent the industry has become on loyalty programs. Airlines aren’t denying it. They’re leaning in, saying that these cards helped raise critical funds during the COVID crash and that without them, loyalty programs would collapse.
What’s at Stake for Travelers?
- Over 31 million Americans hold airline-branded rewards credit cards.
- In 2023, 57% of all miles and points came from using those cards.
- Nearly 16 million domestic flights were taken using points earned through airline credit cards.
So yeah, this isn’t just about airline profits, it’s about how regular travelers afford travel.
Loyalty programs aren’t just a marketing gimmick. They’re big business. According to On Point Loyalty, Delta, United, and American each saw their loyalty programs valued at over $20 billion last year.
What Happens Next?
This isn’t the first time this bill has popped up. The same fight played out in 2023 and was shut down, but there’s a new twist now: the legislation might get attached to a cryptocurrency regulation bill, which gives it a better shot at passing.
Durbin claims the bill could save consumers and merchants $15 billion a year. But airlines say that comes at the cost of frequent flyer miles, tourism, and the average traveler’s ability to earn free flights.
No official response yet from Senators Durbin or Marshall on the airlines’ concerns.
Meanwhile…
The Department of Transportation is still investigating whether airlines are using their loyalty programs fairly. In 2023, the Biden administration ordered American, Delta, Southwest, and United to submit records and ensure they weren’t using loyalty programs to mislead or trap consumers.
For now, your miles are still safe, but if this bill moves forward, your next free flight might not be as easy to earn.
