International Airlines Group (IAG), the owner of British Airways, has inked a multi-year agreement to extend its global partnership with American Express.

Under the agreement, American Express agreed to pay IAG Loyalty nearly £750m ($955m) as the latter grapples with a cash crunch amid Covid-19 pandemic.

The agreement involves the pre-purchase of Avios points that American Express will use for its British Airways co-branded cards and rewards programme.

IAG Loyalty is a subsidiary of IAG that offers a suite of services to its airlines business and B2B customers.

These include Avios reward currency for the British Airways Executive Club, Iberia Plus, Aer Club and Vueling Club customer programmes as well as loyalty management tools.

Back in April, IAG admitted that it was burning through €200m per week. According to media reports, the airlines group had €10bn ($11.6bn) of liquidity at April-end.

The company’s finances have been hit by the novel coronavirus pandemic which led to travel restrictions for certain destinations and consumer worries.

The virus-related lockdown curbs have eased and flying has restarted, however, the pandemic led to media speculation that the company may need to raise new equity.

In 2018, American Express signed an agreement with Aimia and Air Canada to continue its role as a payments card partner in the Aeroplan rewards programme.

Last year, Singapore Airlines partnered with American Express to launch a new business credit card for SMEs.