The Canadian Imperial Bank of Commerce is launching an enhanced travellers' loyalty program, making good on its promise to broaden its offerings just two weeks after agreeing to sell about half its Aeroplan customer base to TD Bank.
Unlike Aeroplan, which originated as Air Canada's frequent-flier rewards program, points collected with the new CIBC Aventura cards can be used to buy tickets on any airline.
CIBC has been the main issuer of Aeroplan credit cards for more than 20 years, under a series of long-term agreements that was set to expire at the end of this year.
Over time, however, other banks have brought out other travel points cards to compete with CIBC's Aerogold and Aimia, the company that runs Aeroplan, has added a wider variety of partners such as retailers.
David Williamson, senior vice president of retail and business banking at CIBC, said Tuesday, that the CIBC Aventura lineup was developed "based on extensive research with Canadians on what they want in a travel rewards program."
The bank said the Aventura cards offer the most choice of any travel rewards program, giving them "the opportunity to choose the rewards program that best meets their needs."
The changes follow a decision by Aimia's to pick TD Bank Financial as the primary issuer of Visa credit cards for its flagship Aeroplan program. The deal comes with a 10-year term, starting Jan. 1, 2014.
CIBC contested Aimia's decision and eventually reached a deal that gives each bank rights to half of the portfolio of Aeroplan Visa accounts.
CIBC will keep the half of the portfolio that includes Aerogold customers with broader relationships with the bank. CIBC will continue to issue Areogold cards for another 10 years, starting Jan. 1, and introduce its own travel loyalty rewards.
There will be hot competition for the loyalty of travel rewards collectors over the next six weeks, as competing banks and card issuers such as Amex vie to attract consumers who are reconsidering their travel rewards program.
TD has said it expects to acquire about 550,000 cardholder accounts from CIBC, representing approximately $3 billion in card balances and $20 billion in annual retail spending.
Aimia also agreed to pay about $312.5 million to CIBC for the shift of half its Aeroplan cards portfolio to TD, with Aimia funding about $150 million of the payments.
CIBC says the enhancements to the Aventura program mean customers will be able to redeem their points on any airline and select any destination they want, and have access to every seat on the plane.
They will also be able to use their points to pay for flight taxes and fees, and get additional perks like bonus points when they sign up, the option to earn points faster and trip cancellation or medical insurance.
TD has said the transfer of Aeroplan-branded credit cardholders from CIBC will be "seamless" without any interruption in Aeroplan miles earned by customers.