Some American Express cardholders are in for a nasty surprise in November. From 1 November 2015, Amex’s fee-free cards and a small range of corporate cards will no longer be a part of the popular Membership Rewards Ascent program. This program will instead be replaced by the Gateway program, resulting in a range of significant devaluations.
Under the new “Gateway” program, points will be transferred to most airline reward partners at a rate of 4 Amex points to 3 airline reward points. This marks a 25% reduction from the Ascent rate of 1:1, or 4 Amex points to 4 airline points. Furthermore, Amex points will no longer be transferable to Webjet, Virgin Atlantic or Rewards Concierge. There are also concerns that points will no longer be able to be transferred to Hotel loyalty programs such as SPG.
Our members are not happy about the changes. They have already begun discussing the options for affected members. One option is of course to cancel the card altogether.
If my Amex Platinum Credit Card is forced to move from current Ascent program to his new Gateway program, then that will signal the end of my 22 relationship with Amex as I will not be renewing at my October anniversary date.
In some cases, however, upgrading to another card with an annual fee may actually make financial sense. There are a number of cards with relatively low annual fees that will remain part of the Ascent program. Cards in the Ascent program will continue to offer transfers at the more generous current rate. There are also a number of cards with annual fees that offer free flights, lounge passes and other benefits. In some cases, the value of the free flights actually outweighs the cost of the card, making it a very good deal.
…you should upgrade to one of the higher level affinity cards which offers a free flight. That way you still earn MR 1:1 and get more value out of the flight than you pay for the fee. If Amex are going to pinch pennies, so should you.
If you are affected, you will receive notification on your credit card statement. Of course, you can continue to transfer points at the higher rate until the end of October. So if you are considering cancelling your card, you may wish to wait until then.
Amex cards that are not affected – which includes most cards with an annual fee – will continue to be a part of the more generous Membership Rewards program, which has not been earmarked for any changes.
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