Continuing a push to maintain its affluent customer base, JPMorgan Chase & Co. has added daily travel auctions to its Ultimate Rewards credit card program and has eliminated the foreign-transaction fee on another of its cards, the issuer announced March 29.
Holders of Chase Freedom, Sapphire, Sapphire Preferred and Ink cards may bid on exclusive travel auctions each weekday in April, Sean O’Reilly, Chase general manager, tells PaymentsSource. “We chose April because it is a significant month for travel spend,” he says.
Cardholders may place bids on the Ultimate Rewards website by using their points or a cash value. If they win the bid, they may use their reward points or their card to pay for the trip, O’Reilly says. The bidding starts at 1,000 points, which equals $10, and each auction will remain live until the end of the month, he says.
The issuer is sponsoring the auctions, which include such trips as a seven-night Alaskan cruise, a five-night Roman holiday and a weekend in New York.
Chase also announced it eliminated the foreign-transaction fee applied to Sapphire Premium cards, giving cardholders a break on the 3% fee applied to purchases made in other countries.
The issuer earlier removed foreign-transaction fees on four other credit cards, most recently for the Continental Airlines Plus MasterCard credit card (
For Chase, adding programs and enhancing benefits to its credit cards is a “high-end strategy,” says Megan Bramlette, director of knowledge management for New York-based Auriemma Consulting Group. “Card issuers are focused on encouraging their very best consumers to stay by convincing them that their cards are the best product for them.”
Foreign-transaction fees usually help banks increase revenue, but issuers seem hopeful that cardholders will continue to use the card and buy international travel packages, says Brian Riley, research director of bank cards for Needham, Mass.-based TowerGroup.
It also is becoming “more fashionable” for issuers to waive foreign-transaction fees, especially on cards with annual fees, Bramlette says. “And issuers will be able to hedge the lost revenue by increasing annual fees,” she notes.
Which is true for Chase. The issuer raised the Sapphire Premium card’s annual fee from $85 to $95, though the fee change does not affect existing cardholders.
Despite the annual-fee increase, many cardholders technically will pay themselves back because new Sapphire Premium cardholders earn 10,000 bonus points if they spend $500 in the first three months, and 10,000 points equates to $100 cash, Riley says.
