Kimberley Moore called JPMorgan Chase & Co. in October to ask if it would lower the $450 annual fee on her United Airlines Holdings Inc. credit card. A United cardholder for roughly 15 years, Ms. Moore traveled often. Then the coronavirus pandemic hit and Ms. Moore, 53 years old, scaled back her spending and canceled travel plans.
Ms. Moore, a senior director at a national health care organization in Washington, D.C., decided to keep the card after JPMorgan offered her a $200 statement credit. But she has barely used the card since, and is instead mostly using debit cards.
Nearly nine months into the pandemic, banks and airlines are scrambling to rescue their airline rewards cards. The companies have deployed the cards for years to win big-spending customers, but the perks they offer—like flight upgrades and airport lounge access—are all but obsolete in a global pandemic.
Typically, card companies don’t disclose the volume of spending on their airline cards versus other, more general-purpose cards. But travel purchases were down about 70% on Visa Inc. cards in the last quarter compared with a year ago. Travel and entertainment purchases were down 69% on American Express Co. cards.
Other categories are faring better. At AmEx, spending outside of travel and entertainment was up 1% in the third quarter. (AmEx says this category represents the majority of its cardholder purchases.)
