Want to know how changes to credit card reward programs could affect you in 2017? Get the latest details and compare your options here.
A number of credit card issuers have made changes to their reward programs in 2016, often resulting in less value for cardholders. It’s also likely that more banks will make updates to their rewards cards in the future.
With reward credit cards frequently having high interest rates and annual fees, changes to factors such as the points per $1 earned or cost of transferring them to a frequent flyer program have a huge impact on the affordability of different cards. This guide outlines the credit card rewards programs undergoing changes, when you can expect them to kick in and how you can compare them.
Credit card reward program updates in 2016
|Credit card issuer||Changes in rewards program||Date effective|
|American Express||Membership Rewards - No changes announced||N/A|
ANZ Qantas Rewards -No changes announced
|14 March 2016|
|Bank Australia||Qantas Rewards -No changes announced||N/A|
|Bankwest||More Rewards From this date, the points required to redeem products and services from the More Rewards website will change. You will be able to view the changes to the points redemption values after the 4 July 2016.Qantas Rewards|
The points you're required to redeem rewards has also changed from this date.
4 July 2016
20 June 2016
|Bank of Melbourne||Amplify Rewards -No changes announced|
|Bank of Queensland|| Q Rewards||1 May 2016|
|BankSA||Amplify Rewards -No changes announced||N/A|
|Citi|| Citi Rewards|
|18 March 2016|
|CommBank|| Awards Program |
November 2015 (ATO payments)
2 May 2016
|HSBC||Qantas Rewards ||August 2015|
|Jetstar||Jetstar Rewards -No changes announced||N/A|
|Latitude Financial Services (formerly GE)||Coles flybuys, GO Rewards and MYER One -No changes announced||N/A|
|Macquarie Bank|| Macquarie Rewards -No points earned on BPAY or ATO payments.|
Qantas -No points earned on BPAY or ATO payments.
Hilton Honors -No points earned on BPAY or ATO payments.
|11 May 2016|
|NAB||Qantas Rewards and Velocity Rewards -No changes announced||N/A|
|St.George||Amplify Rewards -No changes announced||N/A|
|Suncorp Bank||Qantas Rewards||1 May 2016|
|Virgin Money|| Velocity Rewards -The Reduced Flight Benefit (buy one ticket, get a complimentary companion ticket) is being replaced with an annual $129 flight voucher.||April 2016|
|Westpac||28 September 2016|
|Woolworths||Qantas Rewards -No points earned on BPAY or ATO payments.||11 May 2016|
Why have these changes been made?
Most credit card issuers reserve the right to change their reward program details at any time and some even say they may do so “without any notice”, which can make it hard to pinpoint specific reasons for the changes.
The latest reward program updates, however, have largely been attributed to a revision of interchange fees, which businesses accepting credit cards pay to issuers every time we use plastic. As a Bankwest representative explains on the Bankwest Forum:
“The changes made by the Reserve Bank of Australia in November 2015 have reduced the interchange earnings that are used to directly subsidise the cost of reward points and as a result the product features need to be updated to continue to deliver a sustainable product.”
Other reasons for updates could include changes to program partners, consumer feedback or competition within the credit card market at the time.
Tips to get the most out of credit card rewards
- Regularly check for reward program updates. Make sure you have the latest details on your credit card reward program so that you know exactly what value you are getting. Always read your statements and correspondence from your credit card issuer, or check this page for the latest program changes as they are announced.
- Compare cards. Compare reward credit cards to find a card that offers you competitive rewards based on your circumstances.
- Consider a no annual fee rewards card. With many of the reward programs above cutting the amount of points you earn per $1 spent, the cost of an annual fee can easily outweigh potential rewards. So a card that charges no annual fee, such as the American Express Velocity Escape or American Express Qantas Discovery, could be a more affordable option that still earns rewards.
- Factor in redemption costs. When it comes to using your points, some redemption options offer more value than others. For example, a one-way economy flight from Sydney to Melbourne costs 8,000 Qantas points, while a $50 Woolworths gift card costs 8,810 points. So by considering the different points required you can optimise the value of your points.
- Consider an additional cardholder. Another way to add value to your reward credit card is to request an additional card for a partner or family member. This means they can share the account with you and earn points on their purchases as well. Just make sure you discuss repayments and any additional charge for this feature.
- Make use of complimentary extras. As well as points, many reward credit cards come with complimentary extras, such as international travel insurance, airport lounge passes and concierge services. The more you use these perks, the more value you can get out of the card to offset the cost of any interest charges and fees.
Changes to rewards can have a huge impact on the cost of a credit card. By being aware of the latest updates to these programs, you can make more informed decisions about credit cards and get as much value as possible out of the one that you choose.
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