Need a hand with tuition? Try using those Aeroplan points
Aeroplan is going to school to outwit competing loyalty programs.
Credit card rewards operators have broadened out their reward offerings in recent years to include far more than just the occasional free or discounted flight. But a new partnership between Aeroplan and Higher Ed Points Inc., a Toronto-based startup, is perhaps one of the smartest innovations yet — it certainly is one of the most feel-good.
Suzanne Tyson, a former Air Miles exec, created Higher Ed Points last year with the aim of letting collectors convert points into credits that can be used against university or college tuition.
“I ran the idea of converting loyalty points into money for school and every time I mentioned that to friends or colleagues everyone would say, ‘Oh my god, if you can do that you absolutely have to,’” Tyson said.
In March, after much hard work pulling together a technical blueprint of how to pull it off, she took the pitch to Aeroplan, which instantly recognized the win-win chance to offer members something completely different than offerings from competing programs as well as further a good cause.
“We thought it was an amazing opportunity to help our members offset the cost of higher education and get in on that category where actually no one has played before,” said Francine Sternthal, director of project management at Aimia, Aeroplan’s parent company.
Aeroplan has a small window of exclusivity before other reward operators will be allowed to join on.
The program works like so: Aeroplan collectors can exchange 35,000 miles for a $250 credit through Higher Ed Points, which receives a confirmation code attained by the redeemer from Aeroplan on the company’s website and then processes the payment with the affiliate school. More on that can be found here.
So far, two schools have signed on, the University of New Brunswick and Centennial College in Toronto. But many more are in the pipeline, Tyson said.
“The biggest challenge is that every institution is different,” she said. But with the legwork done on creating a platform that brings the school and rewards program together in one place that’s equipped to redeem points and convert them into tuition credits, convincing schools to sign on is not overly daunting, Tyson said.
“I think we spent all of an hour talking to Centennial,” she said.
Keen watchers of the rewards and loyalty landscape are lauding the idea as relatively novel.
“It’s always good to have more ways to redeem your miles,” Patrick Sojka, founder of loyalty program tracking site rewardscanada.ca, said.
Sojka said the so-called redemption ratio, or financial value per Aeroplan reward mile under the current terms, is “not the greatest” but that the program is probably far more valuable to some collectors than a flight or new stereo system.
“It is on the lower side. But that said, it’s a great option,” Sojka said. “For average Canadians who maybe aren’t frequent travelers, who don’t want to redeem for a first-class flight, it gives them an option to save money on their tuition – for some people that may be the best option.”
Any Aeroplan collector can redeem the $250 credit. Higher Ed Points is in the process of creating a web page dedicated to producing persuasive tweets, emails and requests struggling students can dispatch to parents, family and friends encouraging them to unburden their Aeroplan accounts.
A recent study from ratesupermarket.ca, a personal finance website for consumers, suggested it now takes 14 years to repay the average post-secondary loan, according to Kelvin Mangaroo, ratesupermarket.ca’s founder and president.
“That’s on top of trying to save for a new house, start a family, et cetera,” Mangaroo said.
“At the end of the day, it’s helping people get an education and it’s a great way to use points. And for a lot of people, like parents or grandparents, instead of cashing in for a stereo or toaster, if they can help out a student, I’m sure they’d want to do it.”