Business / Business News

Hilton Tarrant
5 minute read
12 Dec 2016
7:27 am

FNB changes Slow Lounge rules as capacity constraints bite

Hilton Tarrant

Two big tweaks take effect from January….

FNB has made two fundamental changes to its Slow Lounge rewards programme for Premier (neé Platinum), Private Clients and Private Wealth (as well as RMB Private Bank) customers. First, the monthly allocation of visits has changed to an annual one. Second – and this is where it gets slightly more complicated – your number of free visits per year is determined by your eBucks reward level. Both changes take effect from January.

This latter amendment in criteria means you could actually see your allocation increase (or decrease!) over time as your eBucks reward level changes. For example, you could start off in January on Level 2 (which nets you six free visits a year on Premier) and progress to Level 4 later on in 2017 (which takes your allocation up to 10). The alignment to eBucks rewards levels is well overdue, especially as the bank has streamlined the programme and tied all its other rewards to your level.

Chris Labuschagne, CEO of FNB Credit Card, says the changes have been necessitated by capacity constraints: “Growth in the base has outstripped our ability to manage capacity”. To be fair, it’s tried to cope with this through peak and off-peak allocations in years gone by, but this complicated the experience for customers (peak vs off-peak allocations remain when it comes to guests).

Extremely high levels of usage over peak times – particularly at a lounge such as OR Tambo International (domestic) in the early mornings and evenings – has affected the guest experience, something the bank quietly admits. And the fact that it has to show away customers has impacted reputation. Labuschagne says the lounges see 50 000 visits, on average, from FNB customers per month (and add to this qualifying guests from various British Airways programmes).

Aside from actively managing capacity, which FNB is doing, the other option is to build its way out of the problem (with partner Comair). Labuschagne points to large capacity increases at both Cape Town International and OR Tambo (international terminal) in recent years as evidence that it is trying. It’s about to begin a project to increase the size of the domestic lounge at OR Tambo by 40%. And the bank hopes a new smaller format lounge at Lanseria (Slow XS) which opens soon will take some strain off OR Tambo, but it’s unlikely this will make a significant impact. That said, it cannot reasonably keep adding capacity forever.

Labuschagne is at pains to point out that the bank is not cutting back on investment and that it is trying as hard as possible to keep the allocation to Premier (removing this benefit from its Premier customers would arguably be a far greater knock to reputation than any capacity issues).

That said, the cuts to the free allocation for Premier customers have been steep. The existing two free visits per month for anyone (who holds a credit card and cheque card and is on eBucks Reward Level 1 or above) changes to a maximum of 12 visits per calendar year for customers on eBucks Reward Level 5 (or as little as just two visits per year for anyone on Level 1). This means that even on Level 5, benefits have been cut in half!

The only positive (especially for Premier customers) is that families or travellers with guests can use more than the two free visits per month on a trip (for example, a family of four on an Easter holiday could use eight of their annual allocation in April, versus having had to pay for additional guests previously.

For Private Clients, which the bank continues to aggressively sell into the upper end of the Premier base, the allocation goes from four free visits per month (on the same criteria as Premier) to an unlimited number of visits on Level 5 (the allocation effectively stays the same (48 per year) for those on Level 4) to as little as six on Level 1.

FNB Private Wealth and RMB Private Bank customers see some changes in allocation, again with additional benefits towards the higher end (Level 4 and 5) but reduced benefits on lower levels. There are no changes to Business customers (aside from a shift to the annual allocation). Access remains limited (for all customers) to 90 minutes before boarding time.

FNB Premier from January 2017 Qualifying Criteria for free visits Free Visits per Calendar Year Fee per additional visit beyond free visits
Credit Card or Cheque Card eBucks Reward Level 1 2 R250 per person
Credit Card and Cheque Card eBucks Reward Level 2 6 R250 per person
Credit Card and Cheque Card eBucks Reward Level 3 8 R250 per person
Credit Card and Cheque Card eBucks Reward Level 4 10 R250 per person
Credit Card and Cheque Card eBucks Reward Level 5 12 R250 per person

 

FNB Private Clients from January 2017 Qualifying Criteria for free visits Free Visits per Calendar Year Fee per additional visit beyond free visits
Credit Card or Cheque Card eBucks Reward Level 1 6 R250 per person
Credit Card and Cheque Card eBucks Reward Level 2 12 R250 per person
Credit Card and Cheque Card eBucks Reward Level 3 36 R250 per person
Credit Card and Cheque Card eBucks Reward Level 4 48 R250 per person
Credit Card and Cheque Card eBucks Reward Level 5 Unlimited R250 per person

 

FNB Private Wealth (or RMB Private Bank) from January 2017 Qualifying Criteria for free visits Free Visits per Calendar Year Fee per additional visit beyond free visits
Credit Card or Cheque Card eBucks Reward Level 1 12 R125 per person (domestic) / R250 (intl)
Credit Card and Cheque Card eBucks Reward Level 2 24 R125 per person (domestic) / R250 (intl)
Credit Card and Cheque Card eBucks Reward Level 3 48 R125 per person (domestic) / R250 (intl)
Credit Card and Cheque Card eBucks Reward Level 4 Unlimited R125 per person (domestic) / R250 (intl)
Credit Card and Cheque Card eBucks Reward Level 5 Unlimited R125 per person (domestic) / R250 (intl)

* I’ve been highly critical of these kinds of cuts in benefits in the past. The irony? I’ve used my free Slow Lounge access (two visits per month) 11 times this year, and I travel very (!) frequently. It’s just not always worth the effort (especially when it’s crowded in the mornings).

* Hilton Tarrant works at immedia. He can still be contacted at hilton@moneyweb.co.za.

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