The Miles & More program returns to customers of a large Polish bank!

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The Miles & More program is again available to customers of Polish banks, specifically to holders of Bank Pekao credit cards. What is the “mileage conversion rate”, i.e. how much do you have to spend on your card to earn a free plane ticket?? Apart from tickets, what can you exchange your miles for? And will the Bank Pekao card with the Miles & More program connected win the hearts of Polish tourists?

Good news for fans of all types of loyalty programs, but especially for those who like to fly. After a break, the popular Miles & More program returns to bank customers – in short, the opportunity to make everyday purchases and at the same time collect points that can be converted into, among others, for plane tickets. The operator of this program is Star Alliance, an alliance of several dozen European carriers, including our LOT.

You can use the Miles & More program directly by registering on the website and earning miles when purchasing airline tickets and other services offered by Star Alliance airlines. But just a few years ago, the most profitable way to participate in the Miles & More program was to have a bank payment card, thanks to which you can collect points on everyday purchases and convert them into miles.

However, banks withdrew from offering cards together with Miles & More. And not only from this airline loyalty program. Quite a few years ago, Raiffeisen Bank withdrew from issuing cards together with Wizzair. In turn, Citi Handlowy stopped cooperating with British Airways. In the fall of 2021, mBank closed the airline card connected to the Miles & More program, and half a year later Diners Club, which also offered the Miles & More loyalty program, withdrew from the Polish market.

Banks’ participation in this type of programs is potentially a big advantage for customers, because they can more quickly collect the miles needed to redeem a free or cheaper airline ticket. The bank hopes to attract more high-end customers (travelers) who will pay with cards more often because they will be motivated by the reward of a free plane ticket.

Perhaps the cost of participating in the program (banks probably co-finance free tickets distributed to their customers under the Miles & More program) turned out to be too high? Let us also remember that when mBank announced the end of participation in the Miles & More program, we had a pandemic that practically grounded travel, which in turn worsened the condition of airlines and reduced their willingness to cooperate with banks.

Now, however, traveling is back in fashion, airlines are recording an increase in the number of passengers, so we have a great return to cooperation between banks and carriers. In Poland, customers of Bank Pekao, the second largest bank in the country, will be able to exchange everyday purchases paid for by card into points and miles.

Read also: You will again be able to collect miles in the Miles & More airline program by paying for everyday purchases with a regular bank card. Good news for travelers

How many zlotys per mile in the Miles & More program?

What are the rules of the Miles & More program offered by PLL LOT and Bank Pekao from February 20? Let me start by saying that credit cards are the “point boosters”. It is about credit card with Żubr, which the bank offers in three variants, and two prestige cards for private banking segment clients: Pekao World Elite Mastercard and Pekao Visa Infinity. You can add a card to the program in a few simple steps in the PeoPay mobile application.

Each customer entering the program receives 1,000 welcome miles. The “exchange rate” of spent zlotys into miles depends on the card variant. In the case of a credit card with Żubr in the Standard variant, 1 mile is awarded for spending PLN 20. The card in the Gold package gives you 1 mile for PLN 10, and in the Platinum package for PLN 6. Even better conversion rate – 1 mile for PLN 5 – applies to the above-mentioned prestige cards.

How many miles do you need to earn to fly somewhere? Bank Pekao states that 10,000 miles could currently be exchanged for a round-trip flight to Barcelona or Paris, 15,000 miles could be exchanged for a ticket to Istanbul, and 35,000 miles could be exchanged for a ticket to Tokyo.

How many miles and in what time will we earn depending on the turnover on the card? The bank calculated this on the example of the Żubr card in the Platinum variant, where – let me remind you – the conversion rate is: 1 mile for PLN 6. A customer who would spend PLN 2,500 a month with the card would collect 5,000 miles in a year, so after two years, he could fly with LOT for points to Barcelona or Paris (and back).

In the case of a customer with a standard card, achieving this goal is rather a distant future. Because to collect 10,000 miles, you need to have a turnover of PLN 200,000 on the card (conversion rate: 1 mile for PLN 20). Everyone can easily calculate how much time it takes. When spending e.g. PLN 2,500 per month by card, We will achieve the required turnover only after 80 months, i.e. after more than 6 years.

Will cards with the Bison win the hearts of tourists?

And if anyone is discouraged by the proposed conversion rates, Bank Pekao boasts that its cards can make traveling easier and more enjoyable in many ways. Their owners can, among others: free to use Business Check-in at Chopin Airport in Warsaw. Cards are also included Mastecard Priceless Chwile loyalty program (with an increased point multiplier).

In addition, users of Gold and Platinum cards can use the so-called fast tracki.e. a quick safety briefing, airport lounges in the event of a delayed flight and attached to cards travel insurance.

It’s February, there are still a few months until the holiday season, but it’s already time to think about choosing or changing financial services and products that can help you during your trip. Are Bank Pekao credit cards a good choice? Currently Approximately 100,000 customers use credit cards with Żubr. The bank reveals that thanks to the Miles & More program it would like to sell several dozen thousand cards this year. Will you be able to achieve this goal?

I’ll start with the strengths. To have a credit card with Żubr, you do not need to have a personal bank account. Moreover, the card in the standard variant is unconditionally free. In the Gold variant, it costs PLN 19 per month, and to reset the fee to zero, you must have a turnover of at least PLN 2,000 per month. The “platinum” card costs PLN 39 per month, and in order not to pay, a turnover of PLN 3,000 is required.

Another advantage is several previously described services supporting travel. Moreover, miles can be exchanged not only for airline tickets, but also for other services, e.g. travel class upgrades (in this case, 8,000 miles are needed).

By using the program as part of a bank card, it is also possible not to forfeit unused miles. As a rule, miles are valid for three years, but this is enough each month, the customer completed a transaction for an amount that would allow you to get at least one mile (PLN 5, 6, 10, 20, depending on the card)so that old miles do not expire either.

And the cons? Definitely a poor conversion rate for PLN to miles in the basic variant of the card. The prospect of actively paying by card for several years to earn a ticket to Paris can be discouraging. On the other hand, it is known that slightly wealthier clients, more active and open to the world, use this type of programs. In their case, the first choice card would be the Gold or Platinum version, with a better rate.

Currency converter? It could be beautiful

And finally, a word about the exchange rate rules applicable to credit cards with Żubr. Because since we are talking about a comprehensive product for travelers around the world (that’s what Bank Pekao advertises), it’s hard to avoid this topic. For years, in “Subiektivno o Finansach” we have been encouraging you to choose the “right” cards, i.e. those that will help you avoid high spreads and currency conversion fees when paying abroad. Cards that meet this definition include currency cards, multi-currency cards (one PLN card connected to several currency subaccounts) or no-spread cards (a PLN card with good rates from the interbank market).

In the case of credit cards, this is impossible, because a card is in fact a loan, and our regulations – after the “rides” with Swiss franc loans – practically prohibit banks from granting credits and loans in foreign currencies.

Therefore, you cannot have a credit card, e.g. in euro, we are stuck with “loans” in PLN. When paying with such a card (debit or credit), two models can be distinguished today. The bank either converts the payment from a foreign currency into Polish zloty at a good interbank exchange rate, but adds a commission for the conversion. The second option is conversion at a much higher bank rate, but without any currency conversion commission. And it is this second model that Bank Pekao uses for credit cards with Żubr. Recently I was counting which model is more advantageous from the customers’ point of view. Application? It was almost the same thing.

But there is also a third path that Bank Pekao could take – the so-called a no-spread card, i.e. settled at good interbank rates and without currency conversion fees. If I also got travel insurance, services allowing me to feel like a VIP when traveling (quick check-in, airport lounge), and the PLN to mile conversion in the Miles & More program would give me a real chance to get a plane ticket within a year or a year and a half… Such a card could conquer the heart of many Polish tourists.

Also listen to the podcast “Financial Sensations of the Week”: in the 198th episode we talk about the fact that Poland is becoming a mecca for real estate investors from all over the world, about the financial plans of Poles, and about the fact that every fourth of us does not plan anything. The podcast also talks about dividend investing – the biggest failure of the last 20 years and the upcoming salvation – and the fact that the discussion about CPK is not about the airport, but about the railway. Maciek Samcik and Maciek Bednarek invite you.

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Title photo: Maciej Bednarek