There’s a joke that often pops up in headlines about airline reward programs: Modern airlines are banks with a small side business of flying passengers around the country.
That joke is looking more like a reality after United Airlines and Southwest Airlines both introduced reward-earning debit accounts in late 2025. Airline loyalists can now direct deposit their paycheck with United or Southwest and earn miles on debit card spending. United’s account even pays the equivalent of interest in airline miles. Both accounts, as well as a similar debit account from Wyndham Hotels, partner with Sunrise Banks on the banking side and Galileo Financial Technologies (a SoFi subsidiary) on the technology side. Visa is the payments network for both airline cards, while Mastercard is the network for Wyndham’s debit card.
The existence of these debit cards hints at the strange economics of modern U.S. airlines. In 2024, Delta Airlines, United Airlines, American Airlines, and Southwest Airlines all lost money on their passenger businesses. The four airlines still combined to make about $14 billion in operating profits overall, because all that money-losing plane flying allowed them to operate their wildly profitable mileage programs.
The Weird Economics of Airlines
The airlines-are-banks joke comes from how these programs resemble aspects of central banks (as opposed to borrow-short, lend-long “your money’s in Joe’s house” banks). Like a central bank, the airlines issue their own popular currency, called miles. They sell their currency to commercial banks for a different, more popular currency, called U.S. dollars. Commercial banks use these miles to encourage consumers to use their credit cards. Credit card users trade their reward miles back to the airlines in exchange for products or services, but generally long-haul business class flights. Airline miles, like other centralized currencies, have an exchange rate and can be devalued by the issuer.
These mileage programs are so profitable that they often eclipse the value of the airline as a whole. American Airlines valued the AAdvantage program between $19.5 and $31.5 billion when using it as collateral for pandemic-era loans. (As of publishing, American Airlines has a market cap around $8.5-9 billion.) United Airlines’ reward program similarly eclipsed the value of the airline itself several times. These programs are valuable because they capture a mind-bending slice of consumer spending: Delta’s CEO has said that spending on Delta’s Amex cards approaches 1% of U.S. GDP.
Credit card fees provide the U.S. commercial aviation industry with profits, not plane tickets. (Cargo also makes the airlines profitable, but to a lesser extent.) Now United and Southwest are looking to capture a slice of debit fees too.
These airline debit accounts, while novel, touch on a handful of trends we’ve seen in CI research over the last few years:
Anything Can Be a Bank
Fintechs paved the way for airlines here. Robinhood, among others, pioneered partnering with traditional banks for debit accounts, settling on this model after an extended cat-and-mouse game with regulators and legislators. (Robinhood introduced checking and savings accounts in 2018 without making sure they were legal, immediately rebranded them as cash management programs, and then pulled them entirely. It later explored getting its own banking charter, something SoFi actually did.) Robinhood and other fintechs instead work with chartered banks to offer debit and savings accounts and passthrough FDIC insurance. Today, all thirteen firms tracked in Corporate Insight’s Fintech Monitor matrix offer debit accounts.
This partner model means that any financial services firm can offer a debit account. With the difference between banks, brokerages, and fintechs already fuzzy, and account aggregation popular, deposit accounts are a logical offering from any firm hoping to become a financial super app. Airlines seem like an odd addition to this field, but squint enough and airlines look like central banks. They’re just branching out to do traditional banking too.
Take this one step further, and anything can be a bank—Experian, Walmart, X, Mr. Beast—if your bank is just the app that manages your deposit account.
Debit Cards Remain Popular with Debt-Wary Younger Generations
These new airline cards also capitalize on the continued popularity of debit cards. While credit cards get the headlines and the advertising, debit cards remain the most popular payment method in the United States. Boomers like credit cards, with 42% using them for most purchases, but only 27% of other generations say they use credit cards as their main payment method. Younger generations say debit cards make it easier to track their spending and avoid debt. (Younger generations also lack the credit history for premium reward cards, and so these preferences may change over time.)
Until recently, caps on debit swipe fees made debit rewards programs untenable, the same way credit card reward programs are almost nonexistent in Europe, where credit card swipe fees are capped. But debit card fee caps do not apply to banks with less than $10 billion in assets. The aforementioned partner model allows fintechs (and now airlines, social media platforms, and YouTubers) to partner with these smaller banks to offer rewards and cashback on debit transactions, as they seek a cut from this area of consumer spending. Offerings from Klarna, Venmo, and United Airlines point to the return of the reward debit card.
Credit Card Rewards Are Under Threat
Calls for a credit card interest rate cap of 10% has led some card issuers to claim that this would end reward programs, although analysis suggests that interest rates and rewards are unrelated. A bigger threat is the proposed settlement with Visa and Mastercard that would allow merchants to reject high-fee rewards cards. (The biggest threat is that Americans collectively realize they don’t want to pay 2-3% extra on all purchases to both subsidize the domestic airline industry and provide free long-haul business class flights for premium card holders.)
Regulation or otherwise, reward cards are changing. Hiked annual fees on the American Express Platinum and Chase Sapphire Reserve cards, along with these card’s high annual spending goals for premium benefits, hint that reward credit cards may become stratified as part of the K-shaped economy. Debit rewards may help issuers and airlines hedge as these rewards programs inevitably evolve.
The Rise of White Label Rewards Programs
As noted above, United, Southwest and Wyndham all partner with the same set of firms to offer their debit reward cards. On the technology side, this follows a pattern CI has seen in life insurance over the last decade, where competing firms employ the same third-party developers to offer white-label wellness rewards programs. Foresters Go and GuardianWell-Being both rely on Swiss digital health platform Dacadoo, for example, while Sureify Labs powers State Farm’s current and Principal’s former wellness program.
The upside of this third-party model is that firms can quickly introduce a rewards program. The downside is that the programs and digital experiences are functionally identical, meaning that the programs are a way to keep pace rather than a competitive differentiator.
In life insurance, MassMutual is trying to stand out with its own in-house wellness rewards app. Airlines may eventually do the same with their banking apps.
Weird, Long-Term Unintended Consequences of the Financial Crisis
A common theme in all this is that non-banks now do a lot of stuff banks used to do. Post-2008 capital requirements on banks, for example, led to lending increasingly being done by non-banks. The result is the mortgage origination industry and private credit growing so big and money-hungry that it’s eyeing 401(k)s, life insurance and annuities. When the Durbin Amendment capped debit swipe fees, it excluded smaller banks because the fee cap was intended as a punishment for bailed out banks. But this exemption allows those smaller banks today to partner with fintechs and now airlines to offer reward-earning debit cards. Traditional banks introduced account maintenance and overdraft fees to make up for the loss of debit swipe fees, annoying consumers and helping fintechs grab a share of banking. The result is that consumers are now comfortable with just about any financial services app being a bank, and possibly even firms outside of financial services.
United Airlines is now a bank, sure. Mr. Beast is now a bank, why not. Eighteen years is the right amount of time for Financial Crisis regulations to spill over into all sorts of unrelated industries. A debit card application that says “Southwest is an airline and not a bank” in the fine print seems to reflect something strange about the current moment. But financial services is full of weird ideas and unintended creations that become accepted and eventually essential. Airlines were already banks in a certain sense. Why not offer debit cards too?
If you’re an airline or YouTuber looking to introduce a debit product or industry competitive intelligence, let’s talk. CI research can help you understand the competition, improve your customer experience, and create a go-to-market strategy.
Patrick Flood is the director of creative content at Corporate Insight.