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Thread: Are all "points as good as cash" loyalty programs inevitably doomed?
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Old Feb 22, 2015 | 1:14 am
  #59  
GUWonder
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Originally Posted by sdsearch
It's very complicated to figure out what Citi effectively paid for AA miles. Besides being the issuer of AA credit cards, Citi is also AA's bank. Citi thus can "pay" AA in ways other than actual money, such as by improving their banking terms. That's not possible in a "simple" relationship (where the bank simply issues the airline's credit cards, but has no other relationship with the airline).

Is Amex Delta's bank the way Citi is AA's bank? Is Chase both UA's bank and Southwest's bank the way Citi is AA's bank?
To figure out what will be the costs in the future is more complicated -- as it's just running estimates until it's not -- than to figure out what was paid; but these 3 large FIs have calculated their historical costs and have used that information before.
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