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Thousands cash in frequent flyer points amid COVID-19 shutdown

Published: (Updated: ) in Australian News by .

The collapse of Virgin Australia and the grounding of international flights has prompted thousands of Australians to cash in their frequent flyer points for household essentials and at-home entertainment.

The collapse of Virgin Australia and the grounding of international flights has prompted thousands of Australians to cash in their frequent flyer points for household essentials and at-home entertainment.

Virgin Australia's Velocity points program has been suspended, while Qantas has reassured its customers of its Frequent Flyer program.

However, many Qantas customers remain concerned points could sit idle for years.

With little prospect of redeeming them on flights any time soon, many are choosing to "buy" everyday items, from groceries and wine through to electrical goods and Bunnings vouchers.

Qantas says it's seen people buy more electrical goods using their points, while sales on the Qantas Wine website rose by 65 per cent in April.

But despite the shift, the airline says the majority of people are stockpiling points for future travel.

RateCity research director Sally Tindall has warned consumers to be aware using frequent flyers on things like groceries would not provide the same dollar value compared to flights.

"While some people are choosing to sit on their points for a time when they can travel again, a lot of people – especially families that are having trouble making ends meets – are opting to cash out their points for things like groceries, to help pay for school equipment or just that trampoline for the backyard to occupy the kids," Ms Tindall said.

"Even though cashing in your points for things like groceries doesn't represent the best value for money, a lot of families aren't planning a holiday anytime soon and they're starting to think about practical ways they can put these points to good use.

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"Our research shows that flights do deliver the best bang for buck when it comes to redeeming your points but families are in a tough time."

Virgin's Velocity frequent flyer program is on hold for point redemptions although you can still earn points through some credit cards.

Qantas frequent flyer accounts remain active as long as at least one point is accrued in an 18-month period.

Two-thirds of Qantas Frequent Flyer points are earned through transactions on the ground rather than through travel, but in some cases customers would have to spend around 40,000 points to redeem a $100 retail voucher.

Dave Ellis had intended to use his frequent flyer to pay for a trip to New Zealand to compete in an event in November but it's been cancelled because of the virus pandemic.

Despite being a chartered account, he has found trying to navigate the best use of his points confusing.

"They're still trying to bamboozle us," Mr Ellis said.

The Sydney father-of-two has crunched the numbers and says he prefers not to leave his points just sitting there for another 12 months.

He plans to buy "groceries now, "especially in a COVID world where funds are pretty tight right now".

Source: 9News https://www.9news.com.au/national/qantas-frequent-flyer-customers-cashing-in-points-amid-coronavirus-travel-shutdown/3956c05b-d320-4be8-9330-7c6037074c69

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