Card rewards scaled back
Reward programs tied to credit cards are being gradually reduced in value, and providers are limiting access to rewards on offer or abandoning rewards altogether. Among recent changes are:
- American Express intends to halve the value of its rewards. If card holders want to preserve the value of future points they will have to pay a $59 fee, as opposed to a $33 reward program membership. Card holders paying the $59 fee will get one frequent flyer point for every $1 of spending; those paying $33 will get one point for every $2 spent;
- ANZ abolished all ancillary rewards on its Qantas Visa card earlier this year. The only rewards available now are Qantas frequent flyer points;
- Citibank has capped the accumulation of points: 40,000 points a year for its basic card and 120,000 points for the platinum card. A dollar of spending earns one reward point, which in turn earns one Qantas frequent flyer point;
- Diners Club reduced the value of its rewards program by one-third after Ansett collapsed. It now offers a rate of $1 for one reward point, which buys one Qantas frequent flyer point (previously 1.5 points with Ansett);
- National Australia Bank cut the value of reward points by one-third last month but has made the rewards more flexible by cutting the link to Qantas frequent flyer points. Gold Mastercard holders must spend $1.50 for one reward point that becomes about $1 of actual cash. This can be used as a payment substitute at any Harvey World Travel outlet.