IndiGo and SBI Card launch co-branded credit card: Right choice for frequent flyers?

IndiGo SBI Card and IndiGo SBI Card ELITE.

SBI Card has partnered with IndiGo to launch a co-branded credit card in two variants, targeting frequent travellers, allowing users to earn 'IndiGo BluChips' on every transaction which can be redeemed for flights, seats, meals and more upon booking with the airline.

Here is a breakdown of the rewards, fees and limitations of the card to determine if it's a worthy addition to the wallet.

The Offer

The two variants of the card are IndiGo SBI Card and IndiGo SBI Card ELITE. The SBI Card offers a dual-network setup, providing two cards under one account - RuPay card as well as Mastercard - allowing transactions domestically and internationally, as well as for UPI payments.

The IndiGo SBI Card Elite credit card offers a rewards structure that earns 7 IndiGo BluChips on every Rs 100 spent on IndiGo website and mobile app and 3 IndiGo BluChips on every Rs 100 spent on hotel and travel bookings on other platforms. The user gets up to 25,000 additional IndiGo BluChip vouchers on spending Rs 12 lakh annually.

Sumanta Mandal, founder of TechnoFino - a platform reviewing debit and credit cards - said the redemption value of IndiGo BluChips typically ranges between Rs 0.40-0.60 per chip. Mandal also advised that booking flights earlier can yield better value for BluChips, as redemption rates may vary depending on demand and availability.

Ankur Mittal, co-founder of Card Insider, highlighted a key feature of the new IndiGo SBI Credit Card variant, "It offers complimentary airport lounge access nationwide, filling a gap in the IndiGo IDFC FIRST credit card launched recently." Mittal also underscored a key distinction between the IndiGo SBI Card ELITE and the basic IndiGo SBI Card, noting that the ELITE variant offers valuable insurance benefits.

Fees and Charges

The IndiGo SBI Credit Card has a joining fee of Rs 1,499 + GST and a renewal fee of Rs 1,499 + GST, while the IndiGo SBI Credit Card Elite has higher fees at Rs 4,999 + GST for both joining and renewal.

If you have an outstanding balance, you'll be charged an interest rate of 3.75 percent per month, which translates to an annual rate of 45 percent. The IndiGo SBI Credit Card charges a forex markup of 3.50 percent, whereas the IndiGo SBI Credit Card Elite has a lower forex markup of 1.99 percent.

According to Mittal, while the IndiGo SBI Credit Card Elite forex charge is competitive, it's not the best option in its price range. For instance, IndiGo IDFC FIRST credit card charges lower forex markup fees and IDFC Mayura Credit Card offer zero forex markup fees with similar joining and annual fees, making it a better alternative.

What Works

The IndiGo SBI Credit Card Elite cardholders get a coverage of up to Rs 3,000 per ticket for up to four flight cancellations and up to Rs 72,000 for loss of checked baggage. According to Mittal, this feature is a significant protection to cardholders in case of emergencies. Both card variants also come with airport lounge access benefits.

What Doesn’t Work

The IndiGo SBI credit cards don't offer annual fee waivers based on spending limits, however, cardholders receive BluChips equivalent to the fees paid - 2,500 BluChips for the IndiGo SBI Card and 5,000 BluChips for the IndiGo SBI Card Elite - along with additional vouchers.

According to Mandal, these BluChips act like a currency to pay for flights, but their value is dynamic and subject to change based on factors like flight route, booking date, and availability, as determined solely by IndiGo.

Mandal said the IndiGo SBI Card Elite offers a 3.5 percent return on IndiGo flight bookings, assuming an average BluChip value of Rs 0.50, as its value is dynamic. However, said this reward rate is modest for a co-branded card, especially for frequent flyers tied to a single airline. Moreover, the return rate drops to one percent for non-flight expenditure, which Mandal finds underwhelming for a premium product.

Spokesperson from SBI Card said, “Our reward rates are similar for most of the reward categories and finest for IndiGo SBI Card Elite on Indigo ticket purchases with 7 BluChip on Rs 100 spent. Additionally, all benefits of IndiGo BluChip program is included for our credit card too.”

The card's limited reward structure is further diminished by the exclusion of essential spending categories - insurance, rent, utilities, wallets and government transactions - from earning rewards, which significantly reduces its practicality for everyday use.

Also Read | Is unlimited sum insured the best safeguard against rising hospital bills?

Comparison

Mandal recommended that while comparing within the IndiGo co-branded ecosystem, the IDFC First Bank IndiGo Credit Card delivers slightly better value on rewards than the SBI IndiGo Elite Card.

Should you Apply?

All those who often fly with the IndiGo airline can earn rewards with these cards, along with additional benefits such as airport lounge access. “Those with high spends can take advantage of these cards as they offer BluChips as milestone rewards,” said Mittal.

Mandal also said that consumers have better options than both the card variants of Indigo SBI credit cards. In comparison, cards like the Axis Atlas Credit Card and HDFC Regalia Gold offer greater flexibility, more substantial milestone benefits, and higher returns, all at a lower annual fee. Even within the IndiGo co-branded space, the IDFC First Bank IndiGo Credit Card provides better rewards value than the IndiGo SBI Credit Card Elite. The IDFC First Bank IndiGo Credit Card also has a lower forex markup charge of 1.49 percent, compared to 1.99 percent for the SBI IndiGo Elite Card.

For those who still want to apply for any of the IndiGo SBI credit card variants, Mittal recommended maximising the card's benefits such as milestone rewards to get the most out of it. "Given the annual fee of Rs 4,999 plus GST for IndiGo SBI Credit Card Elite, we expected significantly more value and benefits, but unfortunately, the card falls short of expectations," said Mandal.