An affinity credit card program allows an organization to offer its members and supporters—those who have an "affinity" for that organization—a credit card that promotes the organization's brand and imagery each time a cardholder uses the card. An affinity credit card program may pay the brand owning organization a bonus for each new account generated, plus a percentage of every transaction charged to the card. In some cases the brand-owning organization will form a revenue and profit sharing joint venture on a 50/50 basis. The venture is funded by the interchange income from the card scheme such as Mastercards or VISA , fees, charges and credit lent to cardholders.
Affinity credit cards are offered by many retailers, shopping centers, airlines, universities, alumni associations, sports teams, professional associations and others, and increasingly by small and mid-sized nonprofits and membership-based groups that rely on these programs for incremental revenue. The first example was Diners Club in New York, and the concept is now widespread and global. In fact, the explosion in popularity of affinity credit cards helped generate the global expansion on the number and use of credit cards in general.
But the affinity credit card industry is changing. To recapture the costs of offering a group's affinity credit card, issuers often prefer working with large organizations that allow direct access to members. This provides the issuer with the group's implied endorsement and access to members for the purpose of cross-marketing credit cards and other financial products. An affinity group with sufficient number of members say in excess of 5,000 and who can give access to its membership base will find many banks willing to issue the credit card.