Indigo co-branded credit cards from HDFC and Kotak or BluChip loyalty plan: Which is more rewarding?

IndiGo, the country’s biggest airline by market share, has operationalised its frequent flyer programme. The IndiGo BluChip loyalty programme rewards its flyers on every booking and the points earned can be used as cash in future bookings.

Before BluChip, IndiGo had a 6E Rewards programme that was linked to co-branded credit cards from HDFC Bank and Kotak Mahindra Bank, and flyers would earn rewards by using these cards. 6E Rewards is still operational and the spends made through these co-branded credit cards continue to be credited to the 6E programme.

Aviation experts have indicated that the two loyalty programmes will be merged eventually. However, IndiGo has officially not spoken of a merger. Queries sent by Mint to IndiGo regarding the merger did not receive any response.

For frequent flyers, the question is which of the two loyalty programmes is more rewarding?Mint gives you the answer.

BluChip

There are three tiers in the BluChip programme – Blu 1, Blu 2, and Blu 3. The base tier is Blu 3, where all members will start. Members can work their way up to the higher tiers based on two criteria – annual spending on IndiGo flights and the minimum number of IndiGo flights taken (see graphics).

Users can also make ‘retro claims’ on past bookings. This means that after creating a BluChip account, you can claim rewards for bookings done up to 90 days earlier and they will be counted towards the eligibility criterion of moving from the base tier to Blu 2 and Blu 1.

For every ₹100 spent on the base fare of a flight booking and fuel surcharge, if any, eight reward points, called BluChips, are awarded. Members of Blu 2 and Blu 1 get an additional two and four BluChips, respectively, making it a total of 10 BluChips per ₹100 for Blu 2 members and 12 BluChips for Blu 1 members.

The biggest advantage of the BluChip programme is that all bookings, irrespective of whether done directly on IndiGo’s website or mobile application or through third-party platforms, will earn reward points. This includes bookings made on online travel agencies such as MakeMyTrip and Ixigo, bank travel platforms such as HDFC Bank’s SmartBuy and Axis Bank’s Travel Edge, online marketplaces including Amazon and Paytm, and offline travel agents.

The value of one BluChip is Re 1. This gives a sweet 8%, 10%, 12% base reward rate on the three tiers, respectively.

Four additional BluChips are awarded when the booking is done directly on the IndiGo website or mobile app. Members also get discounts on certain add-ons, which earn reward points when bought directly on the airline website or mobile app.

IndiGo HDFC Bank credit card

The HDFC Bank co-branded card has two variants – 6E Rewards and 6E Rewards XL. The latter has a higher joining and annual fee of ₹1,770 (including 18% GST) and higher reward rate (see graphics).

While the joining fee on both cards can be recouped with the welcome benefits, there is no option to get the renewal fee waived from the second year.

Cardholders earn different reward rates across three spending categories – IndiGo flights, dining, entertainment and grocery, and other spends including fuel (see graphics).

For fair comparison, the reward rate on IndiGo bookings made through the cards is 2.5% and 5% for the 6E Rewards and 6E Rewards XL variants, respectively. This is lower than the minimum 8% reward rate one can earn on the BluChip programme. From the second year, the net reward rate on the credit cards will be lower due to the annual fee.

As in the case of BluChips, the 6E Reward rate on the cards is calculated on the base fare, excluding fees, taxes, and add-ons.

The main benefit of using co-branded credit cards is that you earn rewards on other spends too. The 6E XL variant has a 3% and 2% reward rate on dining, entertainment and grocery, and other spends. However, the downside is that HDFC Bank has capped the rewards on these expenses, limiting the benefits. For instance, on the 6E Rewards XL variant, expenses on groceries are capped at 2,000 reward points every billing month, while fuel rewards are capped at 500, as per terms and conditions document available on HDFC bank's website. Some users have claimed on public forums that the cap of 2,000 points is not just on groceries but collectively applies to dining and entertainment as well. 

On the 6E Rewards variant, grocery, entertainment, and dining spends are capped at ₹50,000 per month, which limits the maximum rewards you can earn at 1,000. A maximum of 250 reward points can be earned on fuel.

The value of one 6E reward point is Re 1, the same as BluChip.

IndiGo Kotak Mahindra Bank credit card

New users can’t get the Kotak Mahindra Bank credit card due to a ban imposed by the Reserve Bank of India on the lender issuing new credit cards and onboarding new customers.

So, the question is whether existing cardholders should continue using it or switch to the BluChip programme. Sumanta Mandal, the founder of Technofino, said users can continue using it since there are no caps on utility and insurance spending.

“At a time when utilities and insurance have become an exempted category for rewards on most credit cards, the IndiGo Kotak card giving 2% reward with no caps is an attractive proposition,” said Mandal.

The Kotak co-branded cards also come in two variants. The rewards on booking IndiGo flights on the Kotak cards are relatively higher than the HDFC Bank card at 6% and 3% for the 6E Rewards XL and 6E Rewards variants, respectively. The other two categories of dining, entertainment and groceries, and other spends earn the same reward rates as HDFC Bank. However, the Kotak cards are better because the rewards on these categories are not capped.

It should be noted that rent, tax and educational fees are exempted from earning rewards on these cards.

Which one should you choose?

It’s a no-brainer that frequent flyers of IndiGo must sign up for the BluChip programme, given the decent reward rate offered currently. Mandal said it’s not worth getting the HDFC Bank co-branded card.

“With the caps, the card doesn’t offer great value. Those who already have the Kotak card may continue using it for other spends,” he said.

However, even with the co-branded Kotak card, the cardholder should keep in mind that rewards will be credited in the 6E account, and they cannot be clubbed with BluChips during redemption. If you have another credit card that offers rewards of 2% or more on insurance and Amazon Pay vouchers, which can be used to pay utilities, discontinuing the Kotak card might be a better option.

Mandal highlighted that of late, 6E programme members have been unable to redeem their accumulated points. Other users have also flagged this issue on X (erstwhile Twitter), saying that while they can see their 6E balance, when they try to redeem the points, they are redirected to the homepage.

Till the issue is fixed, it is advised that 6E users refrain from using their co-branded credit cards for future bookings.

Moreover, since the BluChip programme rewards all bookings, including those made on online travel platforms and bank travel platforms, apart from the IndiGo website and mobile app, users can maximise the rewards by using any other travel-focused credit card to book IndiGo flights for instant discounts and reward points.