Credit card perk: “We’re paying everything”

I stand in what feels like a luxury hotel suite – all soft lighting, marble countertops, gorgeous seating, parquet style flooring.

A gorgeous assortment of food grabs the corner of my eyes.

“This is a seafood tower as a welcoming food amenity, as well as caviar, and you can also see champagne that guests can enjoy,” says Dana Pouwels, Airport Lounge Benefits at US Bank Chase.

She shows me around Chase’s new Sapphire Lounge at La Guardia Airport in New York.

This can sometimes seem like it’s been recent to wait for a flight. If you can afford to pay $550 (£433) a year to have the correct credit card you need to earn an entry.

After that, once you enter Chase’s new LaGuardia Lounge, you can choose to pay up to $3,000 to access the private suite for a few hours.

It’s all part of what’s been said to be a global arms race among credit card companies you probably don’t know entirely about.

And while most of us don’t have access to these lounges, experts say we’re almost certainly helping them pay. And they don’t get cheaper.

“Yes, it’s an arms race and they’re getting extraordinary,” says Clint Thompson, news editor for flight and travel website The Points Guy. “From what we know, we talk to tens of millions of dollars per lounge.

“I think they spent about $100 million to make it happen, like the new (American Express-owned) Centurion Lounge in Atlanta.”

Airport lounges are not a new concept, and credit card issuers have been working with the airline for a long time to offer branded credit cards with lounge access.

But now, card issuers are building lounges themselves as a direct appealing way to cardholders, as well as potential new customers.

JP Morgan Chase, American Express, Capital One, they are all in lounges and lifestyle businesses.

For the American Express, this includes opening a high-end lounge in midtown Manhattan.

The Centurion New York venue is located on the 55th floor of a high-rise building, with floor-to-ceiling windows offering a wide view of New York, and features a fine dining restaurant and a private bar.

Designed for Centurion Cardholders. This is a card that costs $10,000 to sign the fee and $5,000 a year. And it’s only an invitation to get it.

“We’re more than a credit card company or a charge card company. It’s a lifestyle brand, gaining special access to concerts and participating in restaurants,” says Audrey Hendry, head of global travel at American Express.

Card issuers even moved to coffee shops, a staple of the 21st century.

Capital One has Capital One Cafés. Now you have a barista in the bank.

Their branch in the Georgetown area of ​​Washington, DC, features all the classic signs of a hip coffee shop – exposed vents, bare brick walls, and barista coffee machines.

The only instant giveaway you’re in the bank is the Neon Capital One Sign on the wall and its branded touchscreen. Please take a closer look. It’s something called capital that looks like a customer, but actually calls ambassadors, and helps all banks with the needs.

Anyone can use the cafe, but they will hold a Capital One card and receive money from the brewing.

“We’re creating a product showroom,” says Shaun Rowley, director of Capital One Cafes.

“We’ll come in, see the capital in motion, touch it, smell it, even taste it with the cafe. And, as you know, seeing them rave about their fans and supporters for us is like the return we’re looking for.”

None of this sounds like the language you hear from a regular financial institution.

Danbennett is Ogilby, the head of behavioral science and advertising giant. He says this is about leveraging how the brand thinks about itself and others.

“Yeah, that’s part of the plastic with the tips that hold your money, but it actually gives you a social status,” he says. “It says something about who you are, it is something that you can make to feel high.

“Credit card companies are building self-awareness as well as building airport rooms. It’s amazing how financial services companies have been able to see some deep core human drivers and build experience around them.

“That’s because they were able to not only see the world through a rational lens, but also pull the psychological lever.”

But according to Lulu Wang, even if you don’t intend to access these locations, you’re still paying in the end. He is an assistant professor of finance at Kellogg School of Management at Northwestern University near Chicago, where he studies how the card payment system works.

He points out that credit cards are more expensive for bars and restaurants that accept more than debit cards, as retailers, bars and restaurants have higher processing fees.

Professor Wang says merchants are likely to raise prices to cover additional costs for people using credit cards.

“We usually think that businesses face higher costs. They’re going to give consumers a rather substantial share of those costs,” he explains.

“If we impose all these costs on merchants, it ultimately becomes a cost that we all as consumers. The wealthy people can use high merchants’ fees, high reward cards, and then it is the rest of society that has to pay that fee.”

Anyone who is picking up costs has a clear direction for their trip. As card issuers compete with each other, more lounge and lifestyle experiences are coming.

The arms race to earn your credit card loyalty is not slowing down.