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There has been a five-fold surge in travel-specific credit card applications in the last one year, with an increasing demand from women travellers since the 2022 travel season, revealed data analysed by IndiaLends, an online marketplace for personal loans and credit cards.
Travel credit cards are a special category of credit cards that offer cashback, discounts, and other benefits on a variety of travel-related expenses. Usually offered in partnership with a hotel chain or airline, these cards will typically offer points or miles for flight ticket, hotel, and other travel expenses. Some cards even offer benefits such as discounts on the base fare of your flight ticket, priority check-in, extra baggage allowance, etc.
Among the most applied credit cards on the IndiaLends platform, Axis Bank Vistara credit card, American Express Platinum Travel card, and SBI ELITE card credit have emerged as top-preferred among travellers due to their reward programmes and extensive travel-related perks.
Most travel credit cards are co-branded with popular airlines or travel portals. However, you can also save a considerable amount on travel using all-rounder rewards credit cards like SBI Card ELITE, HDFC Regalia Gold and Axis Bank Select.
Most travel credit cards are co-branded with popular airlines or travel portals. However, you can also save a considerable amount on travel using all-rounder rewards credit cards like SBI Card ELITE, HDFC Regalia Gold and Axis Bank Select.
With a customer base of more than 17 million members, IndiaLends witnessed 50 per cent of all credit card applications for travel-focused credit cards from 2022, with women travellers, comprising 52 per cent.
On the other hand, loan applications for travel purposes have increased two-fold. Interestingly, last year, the company witnessed a 10x growth in loan applications for travel purposes and a 6x growth in travel credit cards.
"Individuals are using credit to invest in acquiring travel experiences as well as leveraging the rewards and benefits offered by credit cards to fully or partially fund their wanderlust," said IndiaLends.
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In the last year, IndiaLends saw 48% of its applications for travel-based credit cards come from members between 24-35 years, followed by 52% from members between 36–45 years. Geographically, this surge in applications is most prominent in the metropolitan cities of Bengaluru (30%), New Delhi (26%), Mumbai (20%), Hyderabad (12%), and the remaining from non-metro cities.
In the last year, there has been a significant increase in credit card applications during March, preceding the holiday season, and from September to December, coinciding with the festive, year-end, and wedding seasons.
"“Looking at the consumer trend, it is apparent that today's youth are not looking at travel just as leisure but as a profound way to create cherished memories and personal growth. This trend is amplified by changing lifestyles that prioritise experiences over material possessions, growing awareness among consumers, and the availability of personalised card options tailored to the preferences of different travellers," said Ankit Khurana, Chief Marketing Officer, IndiaLends.
A substantial 38% of users used their travel-specific cards for everyday expenses for a year and accumulated reward points. Out of those, about 22% used these reward points and got 1 complimentary domestic flight ticket. This made their travel experiences more cost-effective, and it's a practical way to make the most of your spending, whether going on vacation or simply going about your daily purchases.
What to look out for when applying for a travel credit card?
Bonus points in the form of Airmiles
Complimentary membership to airline and airport programs
Free airport lounge access to both international and domestic airports
Discounts on booking of air tickets
Priority check-in at partner airlines
Accelerated reward points on airline-related spends
Extra baggage allowance, etc.
When choosing a travel credit card, look for cards offering flexible redemption options.
"This includes the facility to transfer points to a different airline or hotel loyalty programs, as well as discounts for travel expenses. Some premium travel credit cards offer complementary airport lounge access, golf course access, and offers on booking hotels and flights. There are also some cards which allow you to transfer points to travel partners, which can enhance the value of your rewards," said Adhil Shetty, CEO of BankBazaar.
Do a cost-benefit analysis
ou must also do a cost-benefit analysis to see whether the benefits being offered offset the card’s annual fee. Most importantly, compare different cards to understand their usage and offer terms to select the one that suits your travel needs and lifestyle.
ou must also do a cost-benefit analysis to see whether the benefits being offered offset the card’s annual fee. Most importantly, compare different cards to understand their usage and offer terms to select the one that suits your travel needs and lifestyle.
"With the right travel credit card, users can save a considerable amount on their travel expenses through points/miles, discounted flights/hotel stays and complimentary memberships. For maximum value, consumers should choose a card that carries features and benefits more suited to their travel preferences. For example, for someone who frequently travels overseas, a card with low forex mark-up fee and complimentary international lounge visits would be better. Travelers who prefer a particular airline or travel portal should look for co-branded cards," said Rohit Chhibbar, Head of Credit Cards, Paisabazaar.
