Commonwealth Bank customers will need to spend more to earn points
Commonwealth Bank is the latest of many banks to change its rewards program.
2016 is proving to be a rocky road for rewards seekers. Following the news that Velocity, Citi and ANZ have reduced the value of their respective rewards programs, Commonwealth Bank has announced this week that its CBA Awards members will to need to spend more to receive rewards.
What has changed?
This week, Australia’s biggest credit card provider introduced changes that will decrease the rate at which Diamond and Black card holders can rack up frequent flyer points. Cardholders now need 2.5 Awards points for one Qantas Frequent Flyer point. This is an increase from the previous 2 points you previously needed for every Qantas Point. Velocity Frequent Flyers will be pleased to know that this only affects Qantas flyers, not Virgin Australia rewards.
So how much will I need to spend?
This is a 20% loss in value, meaning you’ll have to spend more to earn the same rewards. At the time of writing the Diamond Card earns 3 Awards Points per $1 spent, you’ll need 16,000 Qantas Points (or 40,000 Awards points) to redeem a return economy flight from Sydney to Brisbane. This means that you will need to spend approximately $13,333 on your card to redeem the return flight. Before the changes were introduced, you could have redeemed the same reward for spending around $10,666 on your card.
CommBank is unlikely to be the last bank to drop the value of its rewards program in the coming months. Experts have predicted that other banks will also make cuts to their rewards programs in response to Reserve Bank plans to limit credit card companies’ payments to banks.