Ryanair launch credit card scheme in deal with MBNA

NO frills airline Ryanair launched its own branded credit card yesterday in a deal with credit provider MBNA.

A standard card offers 16.9% APR while a gold card charges 14.9% APR, the same interest charges as a usual MBNA card.

Balance transfers are levied at 1.9% APR for the first six months. A benefit of the card is if you use it to book travel tickets, accident insurance up to €317,000 is included.

As an incentive to prospective customers, one free return flight on any Ryanair route is awarded after the card has been used for the first time.

This flight is available at any time unlike Ryanair’s usual free flight offers which have restrictions.

Another single free flight is offered after ten flights have been booked and paid for with the card.

At a press conference in Dublin to announce the deal yesterday, chief financial officer Michael Cawley would not reveal exactly what the airline was reaping from the tie-up with MBNA.

“This looks like an unlikely marriage but we think it’s a very good marriage. This is obviously a ready-made market opportunity.”

McCawley said there was a multi-faceted agreement between Ryanair and MBNA with a sign up fee plus follow-on payments. “There is an initial issue and then an ongoing one. There is no point in MBNA or us just getting people onboard.”

He declined to reveal the details of the deal.

Ryanair already gets all of the credit card fee added on to the price of flights on its website.

“If we did €100,000 we’d be reasonably happy and if we did one million, we’d be thrilled and that would be some serious money,” said Mr Cawley.

Last week, Ryanair unveiled another set of forecast-beating figures making a €43 million Q1 pre-tax profit.

Mr Cawley also refused to say how much the credit card deal would add to its revenues.

“In the first year, it is very hard to say, it would be easier if you ask me that question in 12 months time. We are entering into something that is very new to us.

"At very modest levels, it will become our third biggest partner after hotels and car hire. I can’t really say any more than that. We are looking at a seven-figure income.”

To launch the new card, Ryanair put 50,000 seats for sale at €1 plus taxes each way.

Flights are between Ireland and Britain and could be booked from yesterday to midnight tomorrow for travel between February 25 and April 10.

Ian O’Doherty, regional director of MBNA said Ryanair had a strong customer base. “We are about targeting groups that have an interest together.”

Asked why people would switch to this card when it offered the same terms as many already on the market, Mr O’Doherty said: “These rates are competitive but when you add it to the additional offers that Ryanair is putting behind it, it is a very compelling offer”.

The budget airline is refusing to back down on its threat to pull most of its German-Shannon flights this week.

Ryanair began its flight connecting Shannon to Frankfurt-Hahn three years ago induced by Aer Rianta waiving landing fees for the first three years.

This deal expires in May and the airport operator has told Ryanair it will levy discounted landing charges but the low-cost carrier has retaliated by saying it will pull six of its seven weekly flights unless fees are abolished altogether.

Yesterday, Mr Cawley refused to budge on the issue.