The US Department of Transport (DOT) is investigating airline loyalty programmes over the devaluation of rewards points.
The investigation follows a hearing convened by the DOT and the Customer Financial Protection Bureau, in which participants explored issues of transparency and fairness in airlines' rewards and credit card programmes, including the practice of periodically devaluing loyalty points.
According to a report by the consulting firm IdeaWorks, the lowest daily average price of US airline tickets purchased with points or miles was 28% higher in March 2024 than in March 2019, exceeding inflation by seven percentage points.
US airlines such as American, Delta, Southwest and United, are required to provide the DOT with documents relating to devaluation of earned reward points, including how each change made by the airlines over the last six years impacted existing points and status, reports Travel Weekly.
The department is also examining how airlines deploy dynamic pricing for reward redemption and has instructed airlines to provide the average dollar value of one reward point and the price to purchase a point directly from the airline.
To improve transparency, the DOT is asking for documentation on the fees airlines charge to redeem, transfer or maintain points consumers have earned.
Finally, airlines are required to provide documents related to any rewards programme mergers, as well as how they monitor and respond to competing airline loyalty programmes.
