"Things have changed a lot since the 90s. Customers have told us that they want more flexibility and choice.
"That's why we've gone down the route of cash, because we believe cash is king, it's more immediate for customers - if they want to fly they can go flying, if they want to buy, they can go buying and if they want to retire debt, then they can do that as well."
Instead of airpoints, from May 1 BNZ customers would be enticed with a cash-back offer, where they will earn $1 for every airpoint they would otherwise have earned under the current scheme.
Westpac is now targeting "tens of thousands" of BNZ customers who are losing the airpoints perk.
Westpac NZ chief executive David McLean said the partnership was huge for the bank.
"There's a lot of customers who from the first of April won't be able to earn airpoints on their BNZ credit cards, probably over 100,000.
"We're very confident we'll win a large proportion of these customers."
Air New Zealand's general manager of loyalty Hamish Rumbold said more than 20 per cent of all credit card expenditure in New Zealand was on airpoints-earning credit cards.
Card changes
• Air New Zealand is ending its 16-year partnership with BNZ.
• From April 30, BNZ customers will no longer earn airpoints on credit card transactions but will be offered a "cash-back" perk from the bank.
• BNZ customers will get to keep any accrued airpoints they have already amassed.
• Westpac is targeting "tens of thousands" of BNZ customers who will be able to earn airpoints on its cards.
