Air Travel Replaces Cashback as India’s Top Credit Card Reward Choice

Indian credit card users are increasingly shifting away from cashback and opting for high-value travel redemptions, with flight bookings emerging as the most preferred use of rewards in 2025. 

According to a December 9, 2025 report by AI-driven credit card optimisation platform SaveSage, consumers are becoming more strategic in how they use credit card reward points, driven by rising travel costs and better awareness of premium redemption options. 

The trend coincides with a sharp rise in nationwide credit card spending and growing adoption of digital reward optimisation tools.

Flights Over Cashback Signal Smarter Reward Usage

SaveSage’s study found that 32 per cent of all reward points redeemed in 2025 were used for flight bookings or airline mile transfers, overtaking cashback for the first time in India.

In monetary terms, users redeemed ₹850 crore worth of reward points for travel during the year, reflecting growing awareness of high-value redemptions amid rising airfare and hotel prices.

The analysis was based on anonymised data from over 110,000 users managing more than 500,000 credit cards, indicating a broad-based shift in consumer behaviour. Users increasingly redeemed points for business-class seats, long-haul international flights and luxury hotel stays, choosing higher-value experiences instead of flat cash equivalents.

The report noted that users earned an average reward value of 15.6 per cent for every ₹100 spent on travel bookings, the highest return among all spending categories. Overall reward efficiency improved sharply to 7 per cent in 2025, up from 2.2 per cent in 2024, while users aged 30 to 35 years emerged as the most financially savvy group, recording an average optimisation rate of 11 per cent.

Complementing this trend, LoansJagat data highlights how reward accumulation itself is becoming travel-centric. As per LoansJagat’s IDBI credit card reward structure, users earn up to 6 reward points for every ₹100 spent on flight bookings, reinforcing the incentive to channel spending towards air travel.

Read More - GST on Air Tickets

How The Trend Evolved Across Cities and Spending Patterns

Geographically, Pune, Bengaluru and Gurugram recorded the highest reward efficiency levels in 2025. At the same time, Tier-2 cities such as Ranchi, Jaipur and Hyderabad showed the fastest improvement, indicating that strategic reward usage is spreading beyond major metropolitan areas.

The shift also aligns with strong growth in credit card usage nationwide.

Within the SaveSage user base, travel redemptions peaked in November and December, accounting for over one-third of annual travel-related redemptions, as users rushed to exhaust yearly limits before expiry..

Despite rising travel aspirations, several premium benefits remain under-utilised. The study found that only 0.3 per cent of eligible users availed complimentary airport spa services, while even users with unlimited lounge access averaged just one visit every four weeks, highlighting a gap between benefit availability and actual usage.

Credit Card Usage and Benefit Adoption
 

0.3% of eligible users

Lounge visits by unlimited-access users

Once every four weeks

SaveSage stated that consumers are increasingly treating rewards as a financial asset rather than a passive perk. Industry observers believe that clearer redemption pathways and fintech-led optimisation platforms are encouraging users to extract higher value from credit card reward points, particularly for travel-related expenses.

Also Read - International Airport Lounge Access Credit Card

Conclusion

Flight bookings have become the most valuable redemption avenue for Indian cardholders in 2025. As awareness deepens and tools improve, reward optimisation is expected to become a core part of personal finance decision-making.