the very lovely infographic used in the cover photo was made by Daniel Koh. You should check out the rest of the infographics he made on OCBC Voyage here
But now that they’ve got a targeted promotion offering 150,000 / 500,000 miles for an annual fee of $3,210/ $10,000 respectively, I’m getting some questions as to whether it’s worth it to sign up anyway.
Let’s do a quick refresher on what the OCBC Voyage card is and whether the sign up bonus makes sense.
What is the OCBC Voyage Card?
The marketing for OCBC Voyage sounds great in principle. Book any seat on any airline. No need to pay conversion fees to change your bank points to miles. No need to waitlist for a limited number of award seats. What could be better?
Well, here’s the main issue-
The OCBC Voyage card is not a miles card. It is a cashback card with a call option for miles.
I believe this will become clearer in the example below.
Using the Voyage Card
When you spend with the OCBC Voyage card, you earn Voyage Miles. Voyage Miles (VM) are OCBC’s internal currency.
You have 2 options for redeeming your VMs.
- You can convert them to Krisflyer Miles at a ratio of 1:1 (hence my comment that they work like a “call option” for Krisflyer Miles)
- You can use them to redeem air travel on any airline through OCBC’s own concierge for a fixed value ~3 cents each.
Suppose I want to travel from Singapore to Sydney in First Class. Here are my choices with VMs-
Option 1- Conversion
You can convert your VMs into Krisflyer Miles at a rate of 1:1 each and redeem a round trip for 127,500 miles plus $515 in taxes on SQ.
Option 2- OCBC Concierge
You can call up the OCBC Concierge and ask them to make a booking with your VMs. The agent will go online and look for revenue seats in First Class from Singapore to Sydney.
Suppose he finds 2 choices -SQ and TG, $8,400 and $6,500 respectively. He will tell you that you can fly with SQ or TG for 280,000 or 216,667 Voyage Miles respectively (this is based on OCBC’s own internal valuation of VMs at ~3 cents each). You pick one and he issues the ticket over the phone, deducting your VMs.
You should see the inherent problem here- because VMs have a fixed value, you don’t know ex-ante how much your redemption will cost. It depends on the route, time of year, carrier, even time of departure.
When it comes to premium cabin redemptions, it is almost always a bad idea to use your VMs. This is because they will always only every buy ~3 cents of value. So the number of VMs required scales linearly with the cost of the ticket. You have more options with VMs in the sense that you can use them to buy any ticket, but that flexibility comes at a hefty price.
Your Krisflyer miles, on the other hand, buy 2-3 cents of value for economy class tickets, 4-5 cents of value for business class and 6-7 cents of value for first class. That’s the variable value of your miles, and their most important quality.
This is why I call the Voyage Card a cashback card. OCBC is giving you the equivalent of ~3% cashback every time you earn 1 VM.
The irony of the OCBC Voyage was that it was launched as a card targeting the mass affluent- and at a $120,000 income requirement it certainly is. But the way to get any value out of this card is to use VMs for budget and economy class travel. Hardly what most people have in mind when they think about it
OCBC Voyage sign up bonus
Now, to the second point- OCBC is now offering a targeted sign up promotion for the Voyage card.
|Miles||Annual Fee||Cost Per Mile|
|Targeted Offer 1||150,000||$3,210||2.1 cents|
|Targeted Offer 2||500,000||$10,000||2.0 cents|
In general, you should not pay anything more than 2 cents per mile when paying annual fees.So the base sign up offer is a terrible deal. You’re paying for the fancy metal card and a whole lot of hot air.
Offers 1 and 2 are much closer to that threshold. Would I jump on it? No, because I have no pressing need for 500,000 Krisflyer miles at the moment, and I’m still quite cheesed off after discovering how much cheaper redemptions on Cathay (no fuel surcharges) are.
But assuming you have a planned redemption in mind (say, return suites tickets to Paris on SQ which would cost 373,500 miles + fuel surcharges), then this might make sense.
More interestingly, remember that OCBC is giving you VMs, not Krisflyer miles per se (as I assumed in the example above). If each VM has a value of ~3 cents, then your 500,000 miles can buy you $15,000 of value should you decide to use those miles to buy a revenue air ticket.
Arbitrage? Maybe. Assuming my calculations are right, and my ~3 cents was based on values given when the Voyage card launched about a year ago. That value at best has stagnated.
Is there any redeeming value?
The Voyage card gives 2.3 VM per S$1 on dining. There are better options, of course (a certain preferred platinum AMEX card is still alive…), but assuming you want a Visa for flexibility then this card might work. It’s still a lot of money to pay for a dining card though, given that they don’t waive the annual fee of $488.
You get 2.3VMs per S$1 spent overseas too, just below UOB PRVI’s 2.4 miles per S$1. So again, that might be a valid use of it.
I suppose what gets me is the mischaracterization of this card. OCBC has a long history of not having a good miles offering, and this card was the one they hyped up as changing all that. I’m not buying.
But hey, it’s made of metal!