UOB and SIA launch new cobrand offering: KrisFlyer UOB Credit Card

UOB and Singapore Airlines held a joint event at Gardens by the Bay this morning to announce the launch of a new product.

I managed to tag along as the +1 of an intrepid Milelion reader, and here’s what was unveiled:

Singapore Airlines and UOB have launched the KrisFlyer UOB Credit Card, which aims to succeed where the KrisFlyer UOB Debit Card didn’t (in my opinion, at least).

The landing page for this new offering is not live yet, but here’s what we know so far:

UOB KrisFlyer Credit Card Card features

The KrisFlyer UOB Credit Card is available to anyone who earns a minimum of $30,000 a year. Here’s the key features:

• 3 mpd on Singapore Airlines, SilkAir, Scoot and KrisShop
• 3 mpd on transport, dining and online shopping (subject to min $500 spend on Singapore Airlines, Silk, Scoot or KrisShop in a year, otherwise 1.2 mpd)
• 1.2 mpd on everything else

At the moment, I don’t have any information on caps. That, to me, will make or break this card. I’ll update the article when I do.

My quick take is that this could be a good card for people who don’t like having multiple cards.

• You could do better on SQ tickets with the DBS Woman’s World card (4 mpd)
• You could do better on transport like Grab and gojek with the Citibank Rewards Visa/ DBS Woman’s World card (4 mpd),
• You could do better on dining with the new-and-improved UOB Lady’s Card (4 mpd)
• You could do better on online shopping with the OCBC Titanium Rewards/ Citibank Rewards Visa/ DBS Woman’s World card (4 mpd)

…but there isn’t a card that offers you all that in one. So I imagine that if you’re the sort who wants a “one-card strategy”, then this would be useful to you. 

Other features include:

• Fast track to KrisFlyer Elite Silver status
• S$20 KrisShop rebate
• Scoot privileges including priority check-in, priority boarding, additional baggage, standard seat selection, $10 convenience fee waiver and name/fight change fee waiver
• Complimentary JetQuay access (although it should be noted this is a feature of Mastercard, not UOB per se)
• $15 off Changi WiFi
• $15 off Grab rides
• 10,000 KrisFlyer miles when you pay the annual fee
• No KrisFlyer miles conversion fee (presumably because miles are credited directly to your KrisFlyer account)

I’m still waiting to learn more about the mechanisms and T&Cs behind the fast track, rebates and other offerings. The devil, as always, is in the detail.

Here’s the handout from the event:

Bank account features

The KrisFlyer UOB Credit Card can be tagged to a KrisFlyer UOB deposit account. I believe this is the same account that comes with the KrisFlyer UOB debit card, just that it’s tagged to a credit card instead of a debit card.

This means you’ll be looking at a paltry 0.05% interest on all your deposits:

That wouldn’t be so bad if the miles you earned made up for the lack of interest, but that’s not the case.

KrisFlyer UOB Credit Card holders can earn up to a bonus of 5 mpd if they choose to open a KrisFlyer UOB deposit account, but the bonus miles are still capped at 5% of the Monthly Average Balance (MAB). This means that someone with a $50,000 MAB would max out at 2,500 bonus miles, or a mere $500 of spending- all while earning a measly $25 of interest a year! 

UOB has added a “hurdle account” feature of sorts, where you earn a 6 mpd bonus (instead of 5 mpd) when you credit your salary to the KrisFlyer UOB Deposit account. But given the cap, it’s hardly worth forgoing the bonus interest you’d earn from crediting your salary to another hurdle account like the BOC Smart Saver, DBS Multiplier, OCBC 360 etc.

In her introductory speech at the event, UOB Head of Personal Financial Services Jacquelyn Tan mentioned that the bank had “learned” from the UOB KrisFlyer Debit Card bank account, but these restrictive mechanics suggest otherwise.

What does this mean for AMEX?

Until today, the only KrisFlyer cobrand credit cards in Singapore were issued by AMEX. UOB’s new offering is certainly a throwdown to the incumbent, as the comparison below shows:

It seems to me that AMEX has opted to go more for tactical promotions, while UOB is doing theirs year round.

That said, given Mastercard’s wider acceptance and the bonuses on dining, transport and online shopping, AMEX will have their work cut out for them in responding to this new product.

Conclusion

On the surface, the KrisFlyer UOB Credit Card sounds like a decent offering. True, the miles on offer aren’t best in class, but I think they’re going for the customer who wants the convenience of a single card (you’d be surprised how many there are out there). What I really need to know now is the fine print attached to each of those benefits, and I’ll pen a more detailed article when I have it.

Unfortunately, the KrisFlyer UOB deposit account remains fundamentally unattractive due to the low interest rates and cap on bonus miles, and this doesn’t do anything to change that.