Hawaiian Airlines Credit Card Instability Creates Transaction & Loyalty Risks for Tourism and Small Operators

Summary

The reintroduction of the Hawaiian Airlines credit card, following a period of technical disruption, presents ongoing uncertainty for reward redemption and transaction processing, potentially impacting customer loyalty and revenue streams. Businesses should prepare for continued instability and communicate proactively with customers.

• Tourism Operators: Risk of declined transactions or reward redemption issues impacting customer experience and loyalty.
• Small Business Operators: Potential for increased transaction errors or chargebacks.
• Action: Implement enhanced customer service protocols and closely monitor transaction data.

The Change

The Hawaiian Airlines World Elite Mastercard, issued by Barclays, has returned to market after a significant outage that left customers unable to manage their accounts or apply for new cards for several weeks in late 2025 and early 2026. While the card is now technically available, reports indicate ongoing issues with reward redemption and online account management, with customer service lines struggling to provide clear resolutions. This suggests potential underlying system instability that could affect transaction processing and the overall reliability of the card as a payment method.

The lack of clear answers from the issuer, Barclays, and Hawaiian Airlines regarding the root cause and timeline for full resolution means that businesses accepting the card, particularly those within Hawaii's tourism-dependent economy, must operate under a cloud of uncertainty. The primary concern is not just the availability of applications but the full, seamless functionality of the card for everyday transactions and the reliable accrual and redemption of its associated travel rewards.

Who's Affected

Tourism Operators (Hotels, Tour Companies, Vacation Rentals, Hospitality Businesses)

• Customer Experience & Loyalty: The most immediate impact is on customer experience. If customers attempt to use their Hawaiian Airlines card and it is declined due to ongoing system issues, or if they encounter difficulties redeeming rewards for flights or other travel perks, it can lead to frustration and dissatisfaction. This can damage brand loyalty not just to Hawaiian Airlines but also to businesses that are perceived as being associated with the problematic card.
• Transaction Reliability: While major credit card networks are generally robust, underlying issuer issues can manifest as increased transaction declines or processing delays. For operators heavily reliant on credit card payments, particularly for high-value bookings (e.g., hotel stays, multi-day tours), a pattern of declined cards can disrupt revenue flow and create administrative headaches.
• Rewards Program Integration: Businesses that offer co-branded promotions or rely on the airline's loyalty program as a draw for customers may see reduced effectiveness if the card's reward-earning or redemption mechanism remains unreliable. This could lead to a decrease in bookings from cardholders who prioritize the seamless use of their loyalty benefits.

Small Business Operators (Restaurants, Retail Shops, Service Businesses, Local Franchises)

• Transaction Processing Glitches: For merchants, the primary risk lies in potential transaction processing anomalies. This could include a higher-than-usual rate of declines, processing errors, or even a temporary increase in chargeback disputes if customers are unable to verify or manage their transactions due to system issues. While temporary, such issues can strain cash flow and require additional staff time for resolution.
• Customer Spending Habits: Customers who are frustrated with the card's performance or are uncertain about its reliability might shift their spending to other payment methods. If a significant portion of a small business's customer base regularly uses this specific card, a prolonged period of instability could lead to a noticeable, albeit potentially temporary, dip in sales.
• Reputational Risk: Although the issuing bank (Barclays) is primarily responsible, any merchant experiencing recurring transaction issues with a specific card type might be perceived by the customer as having a problem with their payment systems. This is a secondary, but possible, reputational risk.

Second-Order Effects

Persistent instability in a co-branded credit card program can have cascading effects within Hawaii's tightly integrated economy. For instance, if customers face ongoing issues redeeming miles earned through the Hawaiian Airlines card for flights, they might delay or cancel travel plans. This reduced demand for air travel could subtly impact tourism numbers, which in turn affects hotel occupancy rates and bookings for tour operators and local businesses. Furthermore, if cardholders become less engaged with the airline's loyalty program due to rewards redemption problems, Hawaiian Airlines might see a decrease in its overall customer retention and ancillary revenue, potentially leading to adjustments in flight schedules or service offerings that further ripple through the visitor economy.

What to Do

Given the potential for ongoing technical issues and the lack of clear resolution timelines, businesses need to proactively manage the risks associated with the Hawaiian Airlines credit card. The window for action is immediate, as customer interactions and transaction data will reveal the extent of the problem.

For Tourism Operators:

1. Enhanced Customer Service Communication: Train front-line staff to handle inquiries about the Hawaiian Airlines credit card with empathy and direct them to Barclays customer service for specific reward or account issues. Prepare templated responses for common questions and complaints.
2. Monitor Transaction Data Closely: Implement daily checks on transaction approval rates specifically for payments originating from Barclays/Hawaiian Airlines cards. Flag any unusual spikes in declines or errors for immediate investigation.
3. Proactive Communication with Loyal Customers: If you have a database of customers who frequently use this card, consider a brief, informational outreach. A message could state: "We are aware of potential system issues affecting the Hawaiian Airlines credit card and are working to ensure seamless transactions. If you encounter any payment difficulties, please speak with our staff, and we will assist you in finding an alternative payment method."
4. Review Loyalty Program Integration: If co-branded promotions are in place, assess their current effectiveness. Be prepared to temporarily pause or adjust these promotions if the card's reward system remains unreliable, to avoid customer disappointment.

For Small Business Operators:

1. Boost Transaction Monitoring: Pay close attention to your point-of-sale system's reports for any unusual patterns related to Barclays-issued Hawaiian Airlines cards. Note any specific error codes that appear.
2. Prepare for Chargeback Inquiries: If customers face issues and dispute transactions, be ready to provide detailed transaction records promptly. Understand the chargeback process and have evidence of service/goods provided readily accessible.
3. Inform Staff: Ensure your payment processing staff and customer-facing employees are aware of the potential for issues with this specific card and know the protocol for handling declines or customer complaints. Emphasize offering alternative payment methods.
4. Review Payment Processor Relationships: While the issue lies with the issuer, confirm that your own payment processor has not identified any systemic issues on their end that could exacerbate Barclays' problems. Maintain an open line of communication with your processor.

Action Details

Tourism and small business operators should immediately review and, if necessary, update their customer service protocols and transaction monitoring procedures to account for potential ongoing disruptions with the Hawaiian Airlines credit card. This includes training staff on how to address customer concerns, closely monitoring transaction data for anomalies, and being prepared to offer alternative payment solutions to mitigate lost sales and customer dissatisfaction over the next 30-60 days until clearer information or a full resolution emerges from Barclays and Hawaiian Airlines.