[CPLX]

That's not really true on a practical level. For the most part, you can't just buy airline points at the one to two cent price that you effectively get them for in credit card transactions or the even lower price that the credit card companies themselves are likely paying.

[AnthonyMouse]

Airlines do regular promotions where you can buy miles for less than 2 cents per mile. If you get 2% cash back or pay with cash and get a 3% cash discount and can then buy miles for 1.2 cents/mile during the promotion, you're losing 0.8% or 1.8% respectively by using the card that gives you miles instead.

[handle584]

So do credit card companies run transfer bonuses. There are only a handful of airlines who sell pts < 2 cent per point during promo, like Avianca. Others, including the big three US carriers, seldom do this.

Also the big part of this game is sign up bonuses, like spending $5,000 and get 100,000 points instead of the 2% daily rate.

[satvikpendem]

Cash discounts only really exist for locally owned restaurants and other smaller retailers, not bigger ones like Macy's or Best Buy which have a flat price. So in most cases it is in fact the cash purchasers who are paying the 3% fee implicitly but getting no benefits back in the form of cash back or points.